( 


STROM 

LAW 
ALBANY,  I 


UNIVERSITY 

OF  CALIFORNIA 

LOS  ANGELES 


SCHOOL  OF  LAW 
LIBRARY 


HtS 


I    L 


^ 


V 


THE 

TRANSFER  TAX  LAW 

OF   THE 

STATE  OF  NEW  YORK 


ARTICLE     X     OF     CHAPTER    XXIV    OF    THE    GENERAL    LAWS 

AS  ENACTED  BY  CHAPTER  908,  LAWS  OF  1896,  WITH 

THE  AMENDMENTS    THERETO,    AND    AS 

AMENDED  AND  RE-ENACTED 


CHAPTER  368  OF  THE  LAWS  OF  1905 

IK 

EFFECT  JUNE  1st,  1905 

WITH 

ANNOTATIONS  AND  REFERENCES 

TOGETHER 

WITH  A  TABLE  OF  CASES  AND  FORMS 
BY 

GEORGE   W.    McELROY 

OF   THE    ORANGE    COUNTY    BAR 

AS8ISTANT   CHIEF    CLERK    IV    THE   TRANSFER    TAX    BUREAU,    STATE   COMPTROLLER'S 
OFFICE,    ALBANY,    N.    Y. 


ALBANY,    N.    Y. 
MATTHEW  BENDER  AND  COMPANY 

1905 


T 


Copyright,  1905, 

BY 

MATTHEW  BENDER  AND  COMPANY 


3  -c< 


J.   B.    LYON   COMPANY 

PRINTERS    ANU    BINDERS 

ALBANY,    N.    Y. 


t 


) 
'V. 


INTRODUCTORY, 


On  the  10th  of  June,  1885,  an  act  to  tax  gifts,  lega- 
cies, and  collateral  inheritances  in  certain  cases  was 
passed  in  this  State.  This  original  act  did  not  take 
effect  until  June  30,  1885  —  the  twentieth  day  after  its 
final  passage.  Matter  of  Eoive,  112  N.  Y.  100.  The 
scope  of  this  act  was  extended  from  time  to  time  until, 
in  1892,  it  was  repealed,  substantially  re-enacted,  and 
continued  by  chapter  399  of  the  Laws  of  that  year, 
passed  April  30th,  entitled  "An  act  in  relation  to  tax- 
able transfers  of  property."  This  act  was,  by  Gen- 
eral Laws  (chap.  24),  being  chapter  908  of  the  Laws 
of  1896,  repealed  and  substantially  re-enacted  as  ar- 
ticle 10  of  the  Tax  Law,  which  article,  as  amended  and 
construed  from  time  to  time,  constituted  the  law  of 
taxable  transfers  in  this  State  until  1905. 

The  Act  of  1905,  in  effect  June  1st  of  that  year, 
does  not  repeal  chapter  908,  Laws  1896,  but  substan- 
tially re-enacts  the  provisions  of  said  act  as  thereto- 
fore amended,  making,  however,  certain  amendments 
which  were  deemed  expedient  for  the  better  enforce- 
ment of  the  provisions  of  this  law,  and  specifically 
exempting  transfers  to  educational,  charitable,  mis- 
sionary, benevolent,  hospital,  or  infirmary  corpora- 
tions, equally  with  a  bishop  or  religious  corporation, 

who  have  been  so  exempted  since  1892. 

[iii] 


IV  INTRODUCTORY. 

The  law  of  1892  took  effect  May  1,  1892.  Matter 
of  Milne,  76  Hun,  328;  Matter  of  Fayerweather,  143 
N.  Y.  114.  Section  22  of  that  act  denned  the  words 
"  estate  "  and  "  property  "  as  meaning  the  property 
or  interest  of  the  decedent,  and  not  the  property  or 
interest  transferred  to  the  individual  beneficiary,  and 
the  Court  of  Appeals,  in  the  Matter  of  Hoffman,  143 
N.  Y.  327,  held  that  under  this  act  it  was  the  aggre- 
gate amount  of  the  estate  passing  to  taxable  persons, 
and  not  the  share  of  each  individual  legatee,  which 
would  determine  thereafter  whether  the  taxable  limi- 
tation had  been  equaled  or  exceeded,  thus  changing 
the  basis  upon  which  estates  prior  to  this  act  had 
been  held  taxable  or  exempt. 

The  Act  of  1896  did  not  take  effect  until  June  15th 
of  that  year.  Matter  of  Sloane,  154  N.  Y.  109.  By 
reason  of  combining  the  Transfer  Tax  Law  with  the 
General  Tax  Laws,  and  in  view  of  the  language  of 
section  220,  taxing  only  transfers  to  persons  or  cor- 
porations "  not  exempt  by  law  from  taxation,"  mu- 
nicipal corporations,  mentioned  in  subdivision  3  of 
section  4  of  chapter  908,  Laws  of  1896,  and  the  cor- 
porations and  associations  mentioned  in  subdivision 
7  of  said  section  4,  claimed  and  received  exemptions 
from  the  provisions  of  the  Transfer  Tax  Law  (Matter 
of  Thrall,  157  N.  Y.  46)  until  section  243  was  added 
to  the  Tax  Law  by  chapter  382,  Laws  of  1900,  in 
effect  April  11th  of  that  year.  Matter  of  Watson,  171 
N.  Y.  256. 

These  former  successive  laws  have  been  held  to  be 


INTRODUCTORY.  V 

a  continuation  one  of  the  other.  Matter  of  Prime,  136 
N.  Y.  347.  So  that  the  reference  in  the  existing  act 
to  "  this  act  "  and  "  this  article  "  apply  to  and  in- 
clude the  original  and  each  successive  act.  Matter 
of  Embury,  20  Misc.  Rep.  75,  45  N.  Y.  S.  821. 

The  Act  of  1891  did  not  operate  to  prevent  a  subse- 
quent assessment  and  collection  of  a  tax  on  the  estate 
of  a  decedent  who  dies  intermediate  the  Act  of  1887 
and  the  Act  of  1891  (Matter  of  Prime,  136  N.  Y.  347) ; 
nor  did  the  change  made  in  the  act  by  the  passage  of 
chapter  908  of  the  Laws  of  1896  prevent  the  assess- 
ment and  collection  of  a  transfer  tax  against  the  estate 
of  a  party  dying  on  December  9,  1895.  Matter  of 
Brundage,  31  App.  Div.  348,  52  N.  Y.  S.  362. 

The  particular  law  of  taxable  transfers  in  force 
at  the  time  of  the  testator's  death  is  generally  the 
one  which  governs  in  the  determination  and  fixing 
of  the  tax.  Matter  of  Milne,  76  Hun,  328,  27  N.  Y.  S. 
727 ;  Matter  of  Roosevelt,  143  N.  Y.  120.  But  where 
an  estate  is  actually  in  the  process  of  settlement,  it  is 
competent  for  the  State  to  impose  a  tax  upon  prop- 
erty in  the  estate  not  taxable  at  the  time  of  the  pro- 
bate of  the  will.  The  State  has  general  power  to  fix 
the  time  at  which  the  right  of  succession  should  be 
taxed,  and  to  define  what  shall  be  a  transfer,  within 
the  meaning  of  the  statute,  so  long  as  such  definition 
does  not  involve  a  violation  of  either  contract  or 
vested  rights.  The  original  act  did  not  constitute  a 
contract  between  the  State  and  a  person  living  at  the 
time  of  its  enactment,  that  if  he  should  die  while  the 


VI  INTRODUCTORY. 

law  was  in  full  operation,  and  unchanged,  he  might 
dispose  of  his  estate  without  the  imposition  of  any 
further  tax  upon  any  rights  or  interests  acquired 
under  his  will  than  the  tax  imposed  by  that  law.  Mat- 
ter of  Vanderbilt,  50  App.  Div.  246,  63  N.  Y.  S.  1079; 
affd.,  163  N.  Y.  597;  followed,  Matter  of  Vanderbilt, 
58  App.  Div.  619,  68  N.  Y.  S.  1150;  affd.,  166  N.  Y. 
640. 


AUTHORS    PREFACE. 


While  the  Inheritance  and  Transfer  Tax  Law  has 
been  referred  to  as  a  tax  upon  the  estates  of  the  dead, 
and  has  received  more  or  less  criticism  from  those 
who  were  particularly  affected  by  its  provisions,  yet, 
after  the  lapse  of  twenty  years,  it  is  generally  con- 
sidered a  fair  and  reasonable  method  of  providing,  in 
part,  for  the  support  of  Government,  and  it  is  un- 
doubtedly the  least  burdensome  of  any  of  the  methods 
of  taxation  which  contribute  to  that  end. 

It  is  safe  to  predict  that  no  system  of  taxation  will 
ever  be  welcomed,  but  it  would  seem  that  a  tax  im- 
posed upon  the  succession  to  property  which  a  bene- 
ficiary has  not  contributed  to  produce,  or  even  to 
keep  safely  while  it  was  accumulating,  should  not  be 
grudgingly  paid,  when  we  consider  the  sovereign  right 
of  the  State,  in  providing  for  the  support  of  Govern- 
ment, to  lawfully  impose  a  tax  upon  one's  home,  his 
business,  or  even  his  annual  earnings. 

The  present  Transfer  Tax  Law  is  the  result  of 
numerous  amendments  enlarging  not  only  the  class 
of  taxable  persons,  but  also  the  property  included  in 
the  transfer,  until  in  1891  the  taxable  transfers  in- 
cluded transfers  to  lineals  as  well  as  collaterals,  and 
since  1903  has  included  the  transfers  of  real  as  well 

rviii 


viii  author's  preface. 

as  personal  property  to  both  classes  of  taxable  per- 
sons. 

The  amendments  by  chapter  363  of  the  Laws  of  1905, 
reference  to  which  is  hereinafter  made  at  the  end  of 
each  section,  respectively,  do  not  enlarge  or  change 
materially  the  provisions  of  the  Transfer  Tax  Law 
in  force  during  the  past  six  years,  but  certain  pro- 
visions which  have  become  inoperative,  either  by 
amendment  since  their  enactment,  or  by  decisions  of 
the  courts,  have  been  omitted,  and  the  material  pro- 
visions, wherever  necessary,  have  been  arranged  con- 
secutively and  under  appropriate  headings,  or  as  sepa- 
rate paragraphs,  so  that  it  is  possible  now  to  find  any 
particular  provision  from  the  context  of  each  section, 
without  reading  the  whole  section  through. 

The  author  has  endeavored  to  place  in  a  concise 
form  the  law  relating  to  the  provisions  embraced  in 
each  section,  so  that,  in  referring  to  any  particular 
provision  or  section,  the  whole  law  relating  thereto 
will  be  found  immediately  following.  The  provisions 
of  several  of  the  sections  of  the  law  are  discussed  under 
separate  chapters,  whenever  it  has  appeared  that  the 
subject-matter  was  of  sufficient  importance  to  call  for 
such  treatment,  and  reference  should  therefore  first  be 
made  to  the  Table  of  Contents,  immediately  following, 
in  order  to  more  fully  understand  the  scope  and  plan 
of  the  work. 

The  number  of  nonresident  appraisals  have  greatly 
increased  since  1902,  when  the  statute  imposed  a  pen- 
alty upon  all  banks,  stock  companies,  or  other  deposi- 


author's  preface,  ix 

tories  who  permitted  the  stocks  or  other  property  of 
nonresident  decedents  under  their  control  to  be  turned 
over  to  the  representatives  of  the  estate,  without  first 
obtaining  the  consent  of  the  State  Comptroller,  and 
Chapter  VII  relates  wholly  to  the  proceedings  in  cases 
of  nonresident  decedents.  Considerable  of  the  text 
in  the  leading  cases,  in  respect  to  the  taxation  of  trans- 
fers made  by  this  class  of  decedents,  is  given  in  this 
chapter  in  order  that  the  nonresident  practitioner,  who 
possibly  may  not  have  access  to  the  New  York  Reports, 
may  more  readily  understand  the  liability  of  the  estate 
he  represents  to  taxation  under  our  laws. 

Finally,  —  This  work  is  the  result  of  the  author's 
personal  daily  attention  to  transfer  tax  matters  dur- 
ing the  past  four  years,  as  assistant  chief  clerk  in  the 
Transfer  Tax  Bureau  of  the  State  Comptroller's  office, 
and  notations  made  from  time  to  time  during  that 
period.  It  is  placed  in  tile  hands  of  the  publishers, 
not  altogether  as  a  treatise  upon  the  subject,  but  as  a 
reference  book,  containing  the  statutes  and  decisions 
arranged  in  such  a  manner  that  the  practitioner  who 
only  occasionally  refers  to  this  branch  of  the  law  may 
find  the  information  he  desires  as  readily  as  one  who 
has  been  enabled  to  give  considerable  time  and  atten- 
tion to  the  subject-matter  embraced  herein. 

I  am  confident  that  an  examination  of  the  work  will 
commend  it  to  those  having  occasion  to  refer  to  this 
branch  of  the  law. 

Albany,  N.  Y.,  July,  1905. 

George  W.  McElroy. 


TABLE  OF  CONTENTS. 


CHAPTER  I. 

Relating  to  the  Transfer  Tax  Law. 

page. 
Pab.  1.     The  tax  is  upon  the  right  of  succession  under  a  will, 

or  devolution  in  case  of  intestacy 1 

2.  The  law  is  constitutional 2 

3.  Provisions  of  the  act  declared  constitutional 3 

4.  Constitutionality  of  chapter  41,  Laws  1903 5 

5.  Unconstitutional    provision 11 

6.  The  value  of  the  whole  estate  transferred  to  taxable 

persons,  determines  the  liability  of  each  transfer  to 

taxation 13 

7.  The  nature  of  the  tax 16 

8.  Procedure ;   what  statute  governs 16 

9.  Amendments  are  not  retroactive  unless  stated  to  be.  .  17 

10.  Corresponding  sections  of  former  acts  relating  to  tax- 

able transfers 19 

11.  Amendments  by  chapter  368,  Laws  of  1905 21 

CHAPTER  II. 
The  General  Subject  —  Continued. 

Par.         12.     Meaning  of  the  word  "  transfer  " 23 

13.  When  the  transfer  takes  place 24 

14.  When  tax  attaches  to  legacy 25 

15.  Tax  will  attach  upon  the  devolution  of  title 26 

16.  Transfer  of  title ;  time  of 26 

17.  When  legal  and  equitable  title  vests 26 

18.  Amount  of  tax;  how  measured 26 

19.  Meaning   of   provision    "  when    person   becomes   bene- 

ficially entitled,"  etc 26 

20.  Meaning  of  the  word  "  estate  "  prior  to  Act  of  1892.  .  27 

21.  To  what  the  word  "  deed  "  refers  to  in  this  act 27 

22.  The  term  "  intestate  laws  ". 28 

23.  Intestate  law;  distribution  among  collaterals 28 

24.  Equitable  conversion ;  could  not  be  invoked 29 

(xi) 


\ii  TABLE    OF    CONTENTS. 

PAGE. 

Pab.         2o.     Whore  legatee  dies  before  conversion  takes  place 29 

26.     Renunciation  of  legacy;  tax  is  then  upon  the  ultimate 

devolution 30 

CHAPTER  III. 
Taxable    Transfers  —  Property    and    Interests    Taxable. 

Pab.         27.     Taxable    transfers    34 

28.  The  word  "  property  "  is  not  limited  to  the  definition 

thereof  under  the  General  Tax  Law 36 

29.  "  Personal  property  "  as  defined  by  the  Statutory  Con- 

struction Law 37 

30.  What  shall  be  deemed  assets  of  the  estate 37 

31.  When  person  becomes  "  beneficially  entitled,"  etc 38 

32.  Money  deposited  in  bank  to  pay  debt  owing  to  a  non- 

resident decedent 38 

33.  Personal  property  wherever  situated  is  taxable 38 

34.  When  administered  upon  without  the  State 39 

35.  Residence  of  beneficiary  not  material 39 

36.  Note    of    legatee,    included    in    bequest    of    residuary 

estate 39 

37.  Judgment    in    favor    of    decedent    against    heir    or 

legatee 39 

38.  Land  devised  subject  to  a  mortgage 39 

39.  Debts  due  from  a  legatee 40 

40.  Interest  of  decedent  in  surplus  fund  in  partition  suit.  40 

41.  Bequest  for  masses 40 

42.  Good-will  of  business 41 

43.  Legatee  dying  before  receiving  his  legacy;  when  same 

is  taxable 41 

44.  Annuity  to  an  executor  and  trustee  is  taxable 42 

45.  Insurance  policy  payable  to  decedent's  executors,  etc.  42 

46.  Shares  of  stock  in  joint-stock  association 43 

47.  Stocks  of  foreign  corporations 43 

48.  A  bequest  to  the  United  States  is  taxable 43 

49.  Agreement   between    partners    does    not   create    joint 

tenancy 43 

50.  Legacy  in  payment  of  debt  for  services 44 

51.  Legacy  to  widow  in  lieu  of  dower  is  taxable 44 

52.  Seat  or  membership  in  New  York  Stock  Exchange.  ..  45 

53.  United  States  bonds  prior  to  Act  of   1892  and  after 

March  21,  1898 45 


TABLE    OF    CONTENTS.  Xlll 

PAGE. 
Par.         54.     Stock  pledged  as  collateral  to  loan;  redeemed  is  tax- 
able    46 

55.  Legacy  absolute  in  terms ;  although  shown  by  extrinsic 

proof  to  be  imposed  with  a  trust 46 

56.  When  a  taxable  bequest  will  be  deemed  created ;  law 

phrases  unnecessary 46 

57.  Debts  owing  by  resident  to  nonresident  decedent....  47 

58.  Deposit    with    trust    company     although   certificates 

therefor  are  held  without  this  State 47 

59.  Deposits  with  banker  to  protect  a  margin 48 

60.  Profits,  when  taxable 48 

61.  Leasehold  interests  in  land 48 

62.  Money  loaned  is  not  an  advancement 48 

63.  Fund  held  for  grantor's  life,  reserving  power  to  dis- 

pose of  same  by  will 49 

6-!.     Savings  banks  deposits;  in  trust,  etc 49 

65.  Id.;  joint  accounts;  husband  and  wife 50 

66.  Id.;  where  "either  or  the  survivor  may  draw  " 51 

(IT.     Id. ;   "  mother  or  daughter  " 52 

68.  Promissory  note  payable  to  husband  and  wife 53 

69.  Eond    and    mortgage;    held     by    husband    and     wife 

jointly 54 

70.  Taxability  of  an  estate;  what  law  deter  mines 55 

71.  Legacy  in  lieu  of  dower  is  not  a  debt  of  the  estate.  . .  56 

CHAPTER   IV. 

Taxable   Transfers  —  Property   and   Interests   Not  Taxable. 

(§   220,  Tax  Law.) 

Par.         72.     Accrued  rights;   prior  to  Transfer  Tax  Law 57 

73.  Estates  vested,  prior  to  the  Transfer  Tax  Law 58 

74.  Increase  accruing  after  decedent's  death 58 

75.  Bequest  for  burial  plot 58 

76.  Interest  or  share  of  a  decedent  in  an  undistributed 

estate 58 

77.  Legacy  to  executors  subject  to  a  trust 58 

78.  Legacy;  given  in  consideration  of  a  home 59 

79.  Absolute  bequest  with  precatory  words  in  favor  of  ex- 

empt corporations   59 

80.  United  States  bonds  between  May  1,  1892,  and  March 

21,  1898 60 

81.  Stocks  pledged  as  collateral  to  a  loan 60 


Xiv  TABLE    OF    CONTENTS. 

PAGE. 
Par.         82.     Legacy  to  a  brother  chargeable  on  land 61 

83.  Articles  mentioned  in  section  2713  of  the  Code 61 

84.  Proceeds  of  gratuity  fund  of  New  York  Produce  Ex- 

change       61 

85.  Fund  provided  by  will  to  pay  annuity  created  by  trust 

company 62 

86.  Real  property  without  this  State  not  taxable 62 

87.  Legacy  to  be  taxable  must  be  paid  from  property  of 

decedent 63 

88.  Legacy  to  a  corporation  not  in  existence 63 

89.  Legacy  is  a  naked  right  until  reduced  to  possession.  .  64 

90.  Transfer  of  property  by  antenuptial  agreement 64 

91.  Property   transferred   by   reason   of   contract   obliga- 

tions, held  not  taxable 65 

92.  Advancements 66 

93.  Remainders  and  reversions  under  the  earlier  law 66 

94.  Chose  in  action ;  when  taxable 66 

95.  Is  the  widow's  dower  taxable? 67 

96.  Curtesy 68 

CHAPTER  V. 

Taxable   Transfers  —  In    Contemplation   of   Death,    or   to    Take 
Effect  at  or  After  Death. 

(§  220,  Tax  Law.) 

Par.  97.     The  general  subject 69 

98.  Gifts  made   in   contemplation   of   the   death   of  the 

donor,  etc 70 

99.  Distinction    between    gifts    inter    vivos    and    causa 

mortis 70 

100.  Literal  construction  of  the  statute  not  intended....  71 

101.  Transfers;   made  in  contemplation  of  death 73 

102.  To   what  the   words   "  in   contemplation   of   death " 

refer 74 

103.  Transfers   not  made   in   contemplation   of   death   of 

donor 74 

104.  Transfers  taking  effect  at  or  after  donor's  death 77 

105.  When  a  trust  deed  does  not  constitute  an  absolute 

gift 77 

106.  Gift    where    donee    only    survived    the    donor    three 

days 80 

107.  Gifts  upon  conditions  or  agreement 80 

108.  Transfer  not  made  to  take  effect  at  or  after  donor's 

death 82 


TABLE    OF    CONTENTS.  XV 

PAGE. 

Pab.  109.     Vested  interest,  although  will  contains  no  words  of 

present  gifts 86 

110.     Gift;  agreement  to  care  for  donor  for  life 87 

CHAPTER   VI. 

Taxable  Tbansfebs  —  Poweb  of  Appointment. 

(§  220,  Tax  Law.) 

Pab.  111.     Effect  of  general  power  of  appointment 89 

112.  Transfers,  by  the  exercise  of 90 

113.  Object  and  purpose  of  the  statute 90 

114.  Powers  created  by  will 91 

115.  Powers  created  by  deed 94 

115a.  Appointee  can  elect  to  take  under  the  exercise  of  the 

power,  or  under  the  former  will  or  deed 95 

116.  Time  of  payment  is  when  the  power  of  appointment 

is  exercised 96 

117.  Erroneous  payment  cannot  be  considered  a  payment 

made  "  in  advance  " 99 

118.  When  the  power  is  deemed  to  have  been  exercised..    101 

119.  Taxability    of    transfers,    where    funds    over    which 

power  is  exercised  are  without  this  State 108 

120.  When  remaindermen  not  bound  by  acts  of  life  tenant ; 

failing  to  exercise  power 109 

121.  When  tax  on  transfers  under  a  power  will  be  paid 

from  the  donee's  residuary  estate 1 10 

122.  Failure  to  exercise  power,  equitable  conversion Ill 

123.  When  grantee,  with  power  to  dispose,  is  entitled  to 

an  absolute  fee 112 

124.  Decisions   affecting   transfers    upon   the   exercise   of 

power  of  appointment 112 

125.  Decisions  prior  to  the  amendment  of  1897 117 

CHAPTER  VII. 

Taxabijs  Tbansfebs  —  Succession  Tax  Upon  the  Tbansfeb  of 

Pbopebty. 

Nonresident   Decedents. 

"  When  the  transfer  is  by  will  or  intestate  law,  of  property  within 
the  State,  and  the  decedent  was  a  nonresident  of  the  State  at  the  time 
of  his  death.'*     Subdivision  2,  section  220,  supra. 

(§  220,  Tax  Law.) 

Pab.         126.     Constitutionality   of   the   act 120 

127.     History  of  the  law 121 


xvi  TABLE    OF    CONTENTS. 

PAGE. 

Pab.         128.     Personal  property  of  nonresidents  not  removed  until 

after  1892 123 

129.  Jurisdiction  of  the  surrogate 124 

130.  Bonds  and  stocks  of  New  York  corporations;  distinc- 

tion  between   125 

131.  Bonds  and  stocks  of  foreign  corporations  and  tax- 

ability of  United  States  bonds  between  1892  and 
1898 128 

132.  Both  registered  and  coupon  bonds  of  foreign  corpora- 

tions are  taxable  if  here 129 

133.  Money  deposited  in  bank 131 

134.  The  mere  right  to  a  legacy  or  a  residuary  estate  is 

not  presently  taxable 133 

135.  Legacy  payable  to  a  nonresident  who  died  before  re- 

ceiving it,  when  taxable 134 

136.  Seat  or  membership  in  Stock  Exchange 138 

137.  Debts  owing  by  a  resident  to  a  nonresident  consti- 

tute property  within  the  meaning  of  the  statute.  .    142 

138.  Notes  inventoried  at  par  must  be  treated  as  valid 

obligations,   although   some   were   six   years   over- 
due      146 

139.  Money  deposited  with  trust  company  where  company 

issues  certificate  of  deposit  for  same  which  is  held 

by  nonresident  decedent  at  his  domicile 147 

140.  Money  deposited  with  a  trust  company 148 

141.  Life  insurance  policies  not  taxable 149 

142.  Property  of  nonresident  without  this  State 149 

143.  Legacy  to  a  nonresident  beneficiary  is  taxable 149 

144.  Money  transitorily  here  not  taxable 150 

145.  Money  in  savings  banks  or  held  by  decedent's  attor- 

ney is  taxable 150 

146.  Money  deposited  by  a  creditor  to  pay  debt  due  non- 

resident      151 

147.  When  debt   due  nonresident  decedent  was  held  not 

taxable    151 

148.  Loans  made  by  a  partner  to  his  firm  are  taxable. . . .    151 

149.  Debt  on  open  account  due   a   nonresident  from  do- 

mestic associations 151 

150.  Memoranda  of  decisions  as  to  bonds  and  stocks 152 

151.  Right  of   the   foreign   executor   to  apply   decedent's 

property  in  payment  of  legacies 156 


TABLE    OF    CONTENTS.  XV11 

PAGE. 

Pab.         152.     Recognition  of  laws  of  other  States  respecting  dis- 
tribution, etc 157 

153.  Property  of  decedent  where  community  law  prevails.  157 

154.  Residence  of  decedent 158 

,  155.     Will  not  conclusive  as  to  residence 161 

156.     Proceedings  and  practice 162 

CHAPTER  VIII. 
Taxable  Transfers  —  Exceptions  and  Limitations. 

Par.         157.     Exceptions  and  limitations   164 

158.  The  general  subject 166 

159.  Limitations;  to  the  1-per  cent,  class 167 

160.  Limitations  to  the  5-per  cent,  class 168 

161.  Limitations  refer  to  the  aggregate  property  passing 

to  both  classes 169 

162.  Exceptions;  adopted  children 170 

163.  Adoption  under  the  laws  of  another  State 170 

164.  Children  of  an  adopted  child  not  included 170 

165.  Recital  in  will,  respecting:  not  conclusive 170 

166.  Not  included  in  legacy  to  children,  in  case  of  father's 

death 171 

167.  Mutually  acknowledged  relation  of  a  parent 171 

168.  The  relationship  must  be  mutual 172 

169.  The    relationship    can    be    established    as    between 

strangers  in  blood 173 

170.  Failure  to  show  the  relationship 175 

171.  When  relationship  is  established 175 

172.  Proof  of  relationship 176 

173.  Beneficiary  is  a  competent  witness 176 

174.  Burden  of  proof 176 

175.  Stepparent  and   stepchildren 176 

176.  Relation  of  the  parties;  facts  establishing 177 

177.  Living  as  one  family;  does  not 177 

178.  Lineal  descendants 177 

179.  When   the   word   "children"   is   equivalent   to   "de- 

scendants " 177 

180.  Husband  of  a  daughter  includes  "  widower  " !78 

181.  Specifically  exempted 178 

182.  Corporations    specifically    exempted    by    the    Act    of 

1905 181 

183.  Decision  affecting  exemptions  generally 182 

ii 


XV1U  TABLE  OF  CONTENTS. 

CHAPTER  IX. 

r a  .able   Transfers  —  Accrual   and   Payment   of   Tax  —  Discount 
and  Interest. 

page. 

Par.         184.     Accrual  and  payment  of  tax 185 

185.     The  general  subject 186 

136.     When  the  tax  accrues 187 

187.  Accrual,  on  future  and  contingent  estates 187 

188.  Id.;  when  appointment  is  to  be  exercised  over  fund.  .  187 

189.  Id.;  on  certain  remainder  interests 188 

190.  Id.;    on   remainder   when   life   tenant  can   use  prin- 

cipal    188 

191.  Id. ;   upon  renounced  legacy 188 

192.  Payment ;  to  whom  made 188 

193.  Id.;  when  estate  has  been  distributed 189 

194.  Voluntary  payment 189 

195.  When  payment  not  deemed  voluntary 190 

196.  Payment  in  case  of  a  legacy  in  trust  for  life  with 

remainder  over 190 

197.  Payment  of  tax  on  remainders;  Act  of  1887 191 

198.  Payment  of  tax  upon  a  trust  estate 191 

199.  Payment  of  tax  at  decedent's  domicile 191 

200.  Provisions  of  section  222  not  repealed  by  implication.  191 

201.  When  tax  not  payable  from  the  estate  by  the  words 

of  a  will 192 

202.  Discount  and  interest 192 

203.  When  a  discount  is  allowed 193 

204.  Interest 193 

205.  Remission  of  interest 194 

206.  Application  for 194 

207.  To  whom  made 194 

208.  Ignorance  of  the  law;  no  excuse 194 

209.  When  application  will  be  denied 194 

210.  When  interest  commences 195 

211.  Interest  under  the  Act  of  1887 195 

212.  Accrued  right 195 

213.  Other  decisions  relating  to  discount  and  interest.  . .  .  195 

214.  Corresponding  sections  of  former  acts  relating  to  dis- 

count and  interest 196 

CHAPTER   X. 

Taxable  Transfers  —  Lien  of  Tax  and  Collection  Thereof  — 
Refund  of  Tax  Erroneously  Paid. 

Par.         215.     Lien   of   tax  and   collection   by   executors,   adminis- 
trators,  and  trustees 198 

216.     The  general  subject 200 


TABLE    OF    CONTENTS.  XIX 

PAGE. 

Par.         217.     The  tax  is  a  lien  upon  the  property  until  paid 200 

218.  The  two-year  limitation  to  enforce  payment  does  not 

apply 201 

219.  Neither  the  two,  nor  the  six-year  limitations  apply 

to  this  statute 201 

220.  Limitations   prescribed   by   section   282   of   the   Tax 

Law 202 

221.  Collection  of  tax  by  executors,  etc 203 

222.  Executors,  administrators  or  trustees;  liability 204 

223.  Executor  liable ;  although  estate  has  been  distributed.  204 

224.  Tax  on  transfer  of  real  estate;   not  to  be   assessed 

against  executor 205 

225.  Sale  of  what  property  to  pay  tax 205 

226.  Surrogate  cannot  decide  executor's  liability  to  pay 

tax  on  motion 206 

227.  Administrator  cannot  be  sued  individually  for  trans- 

fer tax  withheld 206 

228.  When  executor's  liability  ends 206 

229.  Subrogation;  for  the  benefit  of  creditors 206 

230.  Refund  of  tax  erroneously  paid 207 

231.  The  general   subject 209 

232.  Provisions  of  this  section  are  exclusive 209 

233.  Power  of  surrogate  to  order  refund ;  limitation  under 

Act  of  1897 209 

234.  Refund;  debt  subsequently  discovered 210 

235.  Refund  after  time  to  appeal  has  expired 211 

236.  The  two-year  limitation,  chapter  382,  Laws  of  1900.  .  211 

237.  When  interest  attaches  to  a  refund 213 

238.  Order  need  not  direct  Comptroller  to  refund 214 

239.  Right  to  refund  is  not  a  vested  right 215 

240.  Taxing  debts,  etc.,  erroneously  allowed 215 

CHAPTER  XL 

Bequests  in  Lieu  of  Commissions  —  Liability  of  Ceetain  Corpora- 
tions to  Tax. 

Par.         241.     Taxes  upon  devises  and  bequests  in  lieu  of  commis- 
sions     216 

242.  Tax  on  legacy  to  executors;  subsequently  renounced.   217 

243.  Former   section   226   relating  to   deferred   payments 

omitted  from  Act  of  1905 217 

244.  Effect  of  electing  to  defer  payment  after  chapter  76, 

Laws  of  1899 218 


xx  TABLE    OF    CONTENTS. 

PAGE. 

Par.         245.  Liability  of  certain  corporations  to  tax 219 

246.  Provisions  of  this  section ;  generally  complied  with .  .   222 

247.  Consent  of  Comptroller  to  transfers;  how  obtained. .   222 

248.  Corporations  transfer  at  their  peril;  when 223 

249.  Obligation  to  give  the  notice  rests  upon  the  bank  or 

other  depository 2-3 

250.  Corresponding  provision  of  former  statutes  relative  to 

the  liability  of  certain  corporations  to  tax 224 


CHAPTER  XII. 
Jurisdiction  of  the  Surrogate  —  Appointment  of  Appraisers,  Etc. 

Par.         251.  Jurisdiction  of  the  surrogate 227 

252.  Original  and  exclusive  jurisdiction 229 

253.  Surrogate  is  the  taxing  officer 229 

254.  Determine  all  questions  relating  to  said  act 229 

255.  Power  of  the  surrogate 230 

256.  Can  issue  a  commission 230 

257.  What  moving  papers  must  show 230 

258.  May  construe  a  will 230 

259.  When  without  jurisdiction;  incident 231 

260.  Jurisdiction,    when   power   of   appointment   is   exer- 

cised     231 

261.  Ancillary  letters  can  issue  only  to,  or  with  the  con- 

sent of,  the  foreign  executor 232 

262.  Ancillary  letters  unnecessary  in  transfer  tax  proceed- 

ings     232 

263.  Jurisdiction  over  stock  of  domestic  corporations 232 

264.  What  irregularity  don't  effect 233 

265.  Distribution  does  not  affect  the  jurisdiction 233 

266.  Corresponding  sections  of  former  acts  relating  to  the 

jurisdiction  of  the  surrogate 234 

267.  Appointment  of  appraiser,  stenographer,  etc 234 

268.  The  general  subject 236 

269.  Chapter  658,  Laws  1900,  is  constitutional 238 

270.  County   treasurers   to   act   as   appraiser    in   certain 

counties;   chapter  173,  Laws  of  1901,  is  constitu- 
tional     238 


TABLE    OF    CONTENTS.  XXI 

CHAPTER  XIII. 
Proceedings  by  Appeaisees. 

PAGE. 

Pab.         271.  Proceedings  by  appraiser  241 

272.  Character  of  the  law 246 

273.  Construction  of  the  act 246 

274.  When  appraiser  to  be  appointed 246 

275.  Who  can  make  the  application 247 

276.  Application  of  State  Comptroller  on  information  and 

belief  as  to  taxable  property   247 

277.  State  Comptroller's  right  to  an  appraisal 248 

278.  Where  property  is  in  several  counties 248 

279.  Appraisal  of  interest;  when  postponed 248 

280.  What  statute  controls  proceedings 248 

281.  Notice  of  appraisal 249 

282.  Notice ;  held  insufficient  under  Act  of  1SS7 249 

283.  People;  interested  party,  under  Act  of  1885 250 

284.  Hearings  before  appraiser  250 

285.  Power  of  the  appraiser    250 

286.  May  report  as  to  date  of  decedent's  death 251 

287.  Evidence  as  to  declarations  of  testator 252 

288.  Competency  of  witness 253 

289.  Testimony  of  legatee    253 

290.  Nonresident  executor;  when  not  obliged  to  testify. . .  253 

291.  Basis  of  value 254 

292.  Increase  of  property;  not  to  be  appraised 254 

293.  Appraisal    of    residuary    estate    where    part   thereof 

is  subject  to  appointment 254 

294.  Effect  of  failure  to  tax  known  property 254 

295.  When    omission   to    tax   life   estate    amounts   to   an 

express  reservation  thereof 255 

296.  Burden  of  proof 255 

297.  Worthless    account;    excluded 255 

298.  Report  of  appraiser   256 

299.  What  report  should  show  256 

300.  What  report  should  contain 2"6 

301.  The  American  experience  tables  of  mortality 259 

302.  Surrogate  may  return  report  to  appraiser 260 

303.  Should  vacate  order  when  report  defective 200 

304.  When  second  appraisal  cannot  be  had 260 


XX  il  TABLE    OF    CONTENTS. 

PAGE. 

Pab.         305.  Second  appraisal ;  cannot  increase  value  of  assets . .  .   260 

306.  Id.;  nor  decrease  deductions  for  debts,  etc 261 

307.  Appraisal  not  regular ;  when  261 

308.  When  report  insufficient 261 

309.  Surrogate  may  order  further  appraisal 262 

310.  New  proceeding 262 

311.  Former    proceeding   262 

312.  Appraisal  of  bonds,  stocks,  and  securities 262 

313.  Stocks    of    domestic    corporations   are    appraised   at 

their  market  value  regardless  of  where  their  capi- 
tal is  employed 264 

314.  Unlisted  stocks;   appraisal  of   265 

315.  Joint-stock  associations  266 

316.  Joint-stock    associations    and    corporations;     differ- 

ence between  266 

317.  Taxable  value;  where  there  is  no  market  value 266 

318.  Appraisal  of  inactive  stock    267 

319.  The  test  of  value  267 

320.  Notes  directed  to  be  canceled;  appraisal  of 267 

321.  Notes  or  claims  in  litigation   268 

322.  Disputed  claim;  not  appraised  at  face  value 268 

323.  Appraiser  taking  fee  or  reward 268 

324.  Corresponding    section    of    former    acts    relating   to 

proceedings  by  appraisers   268 


CHAPTER  XIV. 

Proceedings  by  Appbaisees  —  Value  of  Ftjtube  and  Limited  Estates 
—  How  Determined. 

(§  230,  Tax  Law.) 

Par.         325.    The  general  subject  275 

326.  Valuation  of  life  estate ;  where  life  tenant  dies  prior 

to  appraisal 276 

327.  Valuation  of  remainder  interests  subject  to  life  an- 

nuity; where  annuitant  exceeds  his  expectation  of 
life 277 

328.  Vested  and  contingent  future  estates  and  remainders.  278 


TABLE   OF    CONTENTS.  XX111 

PAGE. 

Par.         329.     History  of  the  law  affecting  life  estates  and  remain- 
ders prior  to  1899   279 

330.  a  —  Taxing  expectant  estates  at  their  full  undimin- 

ished value   282 

331.  b  —  Taxing  transfer  upon  the  exercise  of  a  power  of 

appointment 285 

332.  c  —  Transfer  subject  to  a  contingent  incumbrance..   285 

333.  d  —  Increase    accruing;     when     deemed    a     taxable 

transfer 286 

334.  Contingent    remainders     since     1899     are    presently- 

taxable  286 

335.  The  provisions  of  the  amendments  of  1899  (Sec.  230) 

apply  equally  to  the  payment  of  tax  on  vested  as 
well  as  contingent  remainders   288 

336.  When  contingent  or  vested  remainder  not  presently 

taxable 290 

337.  a  —  Where  life  tenant  can  use  a  part  or  all  of  the 

principal 291 

338.  b  —  Where  life  tenant  can  exercise  a  power  of  ap- 

pointment over  the  fund 293 

339.  Words;  not  enlarging  a  life  estate 294 

340.  Discretionary  power  to  beneficiary  to  use  principal 

creates  a  voidable  trust  294 

341.  Annuities;  value  of,  how  ascertained   294 

342.  Id. ;   payment  of  tax  upon 295 

343.  Id. ;  tax  on  fund  subject  to  annuities 295 

344.  Id. ;  when  cost  of  annuity  determines  its  value  as  af- 

fecting the  residuary  estate   295 

345.  Taxes   on  remainder  in  trust  estates   are   presently 

payable 297 

346.  The  Transfer  Tax  Law  does  not  apply  to  remainders 

and  reversions  created  before  it  went  into  effect . .   298 

347.  The  Act  of  1885;  remainder  created  by  deed 299 

348.  Defeasible  interests  —  transfer  of  —  refers  to  testa- 

tor's death   299 

349.  Decision  prior  to  chapter  76,  Laws  of   1899;   when 

contingent  interests  taxable  under  Act  of  1885.  . .  .  299 

350.  Contingent  and  expectant  estates;  Act  of  1892 300 

351.  Vested  interests;  when  taxable 300 

352.  Contingent  interests :   when  taxable  300 


Xxiv  TABLE    OF    CONTENTS. 

CHAPTER  XV. 
Proceedings  by  Appraisers  —  Deductions. 
(§  230,  Tax  Law.) 

PAGE. 

Par.         353.     The  general  subject  303 

354.  Deductions  generally;  commissions  of  executors  and 

administrators 305 

355.  The  commissions  of  temporary  administrators 305 

35G.     Commissions  of  foreign  executors 306 

357.     Executor's  commissions  as  trustee 306 

35S.     Counsel   fees   306 

359.     Disbursements  for  benefit  of  estate 306 

3G0.     Commissions  of  trustee 306 

361.     Deduction  of  note  in  litigation 307 

3G2.     Estimated  expense  of  administration 307 

3G3.     Taxes 307 

364.  Taxes  under  Greater  New  York  Charter 307 

365.  Taxes  assessed  in  decedent's  lifetime 308 

366.  Id. ;  when  assessment-roll  completed 308 

3G7.  Id. ;   due  at  decederVs  death   309 

368.  Claims  against  the  decedent's  estate 309 

3G9.  Doubtful  and  uncertain  claims  309 

370.  Disbursements  of  the  executor  or  administrator 310 

371.  Funeral  expenses 311 

372.  Cost  of  burial  plot    311 

373.  A  judgment,  liability  to  pay  which  is  secured  by  an 

indemnity   bond    and   mortgage    is    not    a    proper 
deduction 312 

374.  Debts   due   New  York  creditors  by  nonresident   de- 

cedent     313 

375.  Doubtful  claims 313 

376.  Value  of  particular  estate  314 

377.  Present  value  of  an  annuity   314 

378.  When  cost  of  annuity  a  proper  deduction 314 

379.  Apportionment   of  debts,   etc.,   between  exempt   and 

nonexempt  personal  property 315 

380.  Widow  entitled  to  money  equivalent  in  lieu  of  neces- 

sary provisions  and  fuel  for  sixty  days 315 

381.  Claims,   etc.,   not   allowed;    expense   of   unnecessary 

action 316 

382.  When  debt  not  allowed   316 

383.  When  commission  not  to  be  deducted 316 


TABLE    OF    CONTENTS.  XXV 

PAGE. 

Par.         384.     Counsel  fees;   when  not  allowed    316 

385.  Sum  paid  for  withdrawal  of  objections  to  probate; 

not  allowed 318 

386.  The   amount  of   the   individual  bond   of  a  decedent 

accompanying  a  mortgage  executed  by  both  dece- 
dent and  his  wife  upon  real  estate  owned  by  the 
wife  will  not  be  deducted  from  the  decedent's 
personal  estate  as  a  debt  owing  by  him 318 

387.  Articles  enumerated  in  subd.  3  of  sec.  2713  of  the 

Code  not  entitled  to  money  allowance  therefor 310 

388.  Legacy  to  a  creditor;  not  to  be  deducted 320 

389.  When  debts  owing  by  nonresidents  not  allowed 321 

300.     Mortgage  debts  not  allowed 321 

391.  Tax  paid  in  another  State 322 

392.  Taxes  under  Greater  New  York  Charter;  when  not 

deductible   324 

393.  Repairs  to  real  estate,  not  allowed  324 

394.  Tax  directed  to  be  paid  as  an  administration  expense.  324 

395.  When  debts  cannot  be  deducted  after  appraisal 325 

CHAPTER  XVI. 
Determination  of  Surrogate. 

Par.         39G.     Determination  of  surrogate 326 

397.  Value  of  the  estate  and  amount  of  tax;  how  deter- 

mined     328 

398.  The  surrogate  is  the  assessing  and  taxing  officer.  .  .   32S 

399.  The   taxing   order   is   the   order  of   the   Surrogate's 

Court   329 

400.  When  application  to  the  Superintendent  of  Insurance 

necessary 329 

401.  Notice  of  determination;  to  whom  given 329 

402.  Presumption  of  notice 329 

403.  Determination;   how  far  conclusive    330 

404.  Id. ;   final  as  to  known  property 330 

405.  Surrogate  to  forward  copies  of  all  orders  to  Comp- 

troller    33° 

406.  When  order  is  not  entered  by  consent 330 

407.  Interest  of  beneficiaries  under  the  order 331 

408.  Vacating  order;   newly-discovered  evidence 331 

409.  Report  can  be  sent  back  for  correction 331 

410.  Surrogate's  power  to  correct  clerical  errors 332 


XXVI  TABLE    OF    CONTENTS. 

PAGE. 
Tab.         411.     Order  of  exemption;   ex  parte  application  for 332 

412.  Appointment  of  guardian 333 

413.  Corresponding  section  of  former  acts;  relating  to  the 

determination  of  the  surrogate 333 

CHAPTER  XVII. 
Appeal  to  the  Subrogate  —  Appellate  Division  —  Court  of  Appeals 

Pab.         414.     Appeal  and  other  proceedings 337 

415.  Who  can  appeal   33S 

416.  Executor's  right  to  appeal    338 

417.  Id.;   only  parties  aggrieved,  however,  may  appeal..  339 

418.  Id.;  immaterial  whether  tax  can  be  collected  or  not; 

if  transfer  is  taxable  339 

419.  Id.;  where  appraiser  refuses  to  appraise  an  asset.  .  .    339 

420.  Id.;    only   remedy    where    debts    are    not   urged    or 

reserved 340 

421.  Id. ;  to  whom  and  how  perfected  340 

422.  Id.,  only  remedy  to  correct  legal  errors  340 

423.  Id.,  where  Comptroller  was  not  a  party 340 

424.  The  order  appealed  from 341 

425.  Surrogate  can  construe  will  on  appeal  to  him 341 

426.  Necessity  of  stating  the  grounds  of  appeal 341 

427.  Object  of  stating  the  grounds  of  appeal 342 

428.  Surrogate    on    appeal    may    receive    additional    evi- 

dence   and    consider   new    questions    subsequently 
arising 342 

429.  May   receive    evidence   that    transfer    was    made   in 

contemplation  of  death 343 

430.  The  surrogate's  discretion   343 

431.  Failure  of  surrogate  to  give  notice;  does  not  affect.  343 

432.  Accepting  payment  as  per  order  does  not  affect 344 

433.  When  order  becomes  final  and  conclusive 344 

434.  Costs  on  appeal   344 

435.  When  costs  not  properly  imposed  on  moving  party.  .   345 

436.  Costs  governed  by  section  3240  of  the  Code 345 

437.  Allowance  of  costs  carries  with  it  the  disbursements.  345 

438.  Appeal  to  the  Appellate  Division 346 

439.  Appellate  Division  will  only  consider  the  grounds  of 

appeal 346 


TABLE    OF    CONTENTS.  XXV11 

PAGE. 

Tab.         440.     When  failure  to  except  to  ruling  not  a  prerequisite 

to  review 346 

441.  Appellate   Division    will    not    interfere   with    surro- 

gate's refusal  to  direct  a  refund 347 

442.  Appeal   to  the   Court   of   Appeals;    matters   in  sur- 

rogate's discretion;  not  subject  to  review 347 

443.  Appeal ;   will  be  dismissed,  when 34S 

444.  But  an  order  of  reversal  upon  the  law  and  the  facts 

is  reviewable  when  no  question  of  fact  is  involved.  348 

445.  When  unanimous  decision  of  the  Appellate  Division 

O  4  Q 

is  reviewable 

446.  Corresponding   sections    of   former    acts    relating   to 

appeals 349 

CHAPTER  XVIII. 

Modification  of  Orders  —  Reappraisal. 

(§  232,  Tax  Law.) 

Pab.         447.  Surrogate's  power  to  modify  decree 351 

448.  Decree  vacated  when  statute  unconstitutional 353 

449.  Order  modified,  although  time  to  appeal  has  expired.  353 

450.  When  surrogate  can  modify  his  decree 354 

451.  Finality  of  surrogate's  determination 354 

452.  Surrogate's  power  to  decree  previous  order  erroneous.  355 

453.  Surrogate's  power  under  subdivision  6,  section  2481 

of    the    Code 355 

454.  Decree  not  opened  to  correct  an  error  of  law 35a 

455.  Decree  modified;   where  legatee  not  notified  of  sur- 

rogate's determination 356 

456.  When    surrogate   cannot    grant   relief    in   regard   to 

debts 356 

457.  Correction  of  order   refused 357 

458.  Surrogate  has  no  power  to  modify  order  on  ex  parte 

application   3o< 

459.  When  surrogate  may  vacate  his  order 358 

460.  Reappraisal;    provision    applies    only    to    errors    of 

fact     358 

461.  Reappraisal ;   when  not  entitled  to 358 

462.  Rehearing ;    when    refused 358 

463.  Improper  to  raise  values  on  reappraisal 359 


XXV111  TABLE    OF    CONTENTS. 

PAGE. 

Tab.         4G4.     Conclusiveness  of  an  appraisal 359 

4()f>.     Corrections 359 

4i!0.     When  order  will  be  set  aside 360 

4(57.     The  Supreme   Court   cannot  vacate  order   for   reap- 
praisal    360 

468.  The  Comptroller  may  either  apply  for  a  reappraisal 

or  appeal 360 

469.  Supreme  Court  at  Special  Term  will  not  review  sur- 

rogate's discretion 361 


CHAPTER  XIX. 

Composition    Agreements  —  Surrogate's    Assistants  —  Proceedings 
by  District  Attorneys. 

Par.         470.     Composition  of  transfer  tax  upon  certain  estates...   364 

471.  Composition  agreements 365 

472.  Corresponding    section    of    former    acts    relating    to 

composition  agreements 366 

473.  Surrogates'    assistants    in    New    York,    Kings,    and 

other  counties 367 

474.  Corresponding  sections  of  former  acts  relating  to  sur- 

rogates' assistants,  etc 369 

475.  Proceedings  by  district  attorneys 370 

476.  Certificate  of  "  probable  cause  "  372 

477.  When  proceedings  to  be  commenced 372 

478.  Which  district  attorney  can  bring  proceedings 373 

479.  Former  adjudication  exempting  legacy  is  a  bar 374 

480.  How  proceedings  commenced 374 

481.  What  can  be  shown  on  the  return  of  the  citation.  .  .  374 

482.  When  the   correctness   of  the  assessment  cannot  be 

raised 375 

483.  Order  directing  payment 376 

484.  Order  for  payment  of  tax,  how  enforced 376 

485.  This  proceeding  is  not  in  nature  of  an  action  for  a 

penalty 376 

486.  Costs  to  district  attorney 376 

487.  When   district  attorney  is  unsuccessful 377 

488.  Corresponding   sections   of   former    acts    relating   to 

district  attorney  proceedings 377 


TABLE    OF    CONTENTS.  XXIX 

CHAPTER   XX. 

Receipts  —  Fees  of  County  Treasurers  —  Books,  Etc.,  Furnished 
by  State  Comptroller  —  Reports  of  Surrogate,  County  Clerk, 
and  County  Treasurer  —  Report  of  State  Comptroller  —  Pay- 
ment and  Application  of  Taxes. 

page. 

Par.         489.     Receipts  from  county  treasurer  or  comptroller ....   379 

490.  Corresponding   sections    of    former   acts   relating   to 

receipts   380 

491.  Fees  cf  county  treasurer 382 

492.  Corresponding   sections    of   former   acts    relating  to 

fees  of  county  treasurer 382 

493.  Books  and  forms  to  be  furnished  by  the  State  Comp- 

troller     383 

494.  Corresponding   sections   of   former   acts    relating   to 

books,   etc.,  to  be  furnished   by  the  State   Comp- 
troller     384 

495.  Reports  of  surrogate  and  county  clerk 384 

496.  Corresponding  section  of  former  acts  relating  to  re- 

ports of  surrogates  and  county  clerks 385 

497.  Reports  of   county  treasurers 385 

498.  Corresponding   sections   of    former   acts    relating   to 

reports  of  county  treasurers 386 

499.  Report  of  State  Comptroller ;   payment  of  taxes ....   387 

500.  Corresponding   sections    of    former   acts    relating   to 

report  of  State  Comptroller,  etc 387 

501.  Application    of   taxes 388 

502.  Corresponding   sections   of    former   acts    relating   to 

application  of  taxes 388 

CHAPTER  XXI. 
Definitions  —  Exemptions  in  Article  One  not  Applicable. 

Par.         503.  Definitions   389 

504.  The  words  "estate"  and  "property"  defined 390 

505.  The  word  "estate"  as  interpreted  prior  to   1892...   390 

506.  Same  construction  in  reference  to  property  passing 

to  lineals  and  others 391 

507.  What  included  in  the  definition  of  the  word  "prop- 

erty " 392 


XXX  TABLE   OF    CONTENTS. 

PAGE. 

Par.         508.     Property  exempted  by  the  definition  in  1892 392 

509.  Meaning  of  "  transfer  " 393 

510.  There   is   no   "transfer"   by   will   unless   legacy  ia 

accepted 393 

511.  Exemptions  in  article  1  not  applicable 394 

512.  First  included  in  the  Transfer  Tax  Law  in  1900 394 


Appendix ™9 

Forms 409 

Table  of  cases  cited 447 

General   index 4*>3 

Index   to    forms 507 

Index  to  sections  of  the  Transfer  Tax  Law   509 


THE  TRANSFER  TAX  LAW. 

(Sections  220  to  243,  both  inclusive,  of  the  Tax  Law.) 


CHAPTER  I. 

Relating  to  the  Transfer  Tax  Law. 


1.  The   tax   is   upon   the  right   of 

succession  under  a  will,  or 
devolution  in  case  of  intes- 
tacy. 

2.  The  law  is  constitutional. 

3.  Provisions  of  the  act  declared 

constitutional. 

4.  Constitutionality   of   chap.    41, 

Laws   1903. 

5.  rjnconstitutional        provision ; 

chapter  76  of  the  Laws  of 
1899,  amending  section  230 
of  the  Act  of  1896. 


6.  The  value  of  the  whole  estate 

transferred  to  taxable  per- 
sons determines  the  liability 
of  each  transfer  to  taxation. 

7.  The  nature  of  the  tax. 

8.  Procedure;  statute  governing. 

9.  Amendments  are  not  retroactive 

unless  stated  to  be. 

10.  Corresponding    sections    of 

former  acts  relating  to  tax- 
able transfers. 

11.  Amendments     by      chap.     368, 

Laws  of  1905. 


1.  The  Tax  is  upon  the  Right  of  Succession  under  a  Will,  or 
Devolution  in  Case  of  Intestacy. 

In  several  of  the  earlier  cases  the  court  stated  that 
in  deciding  the  question  therein  presented  it  was  not 
necessary  to  determine  whether  the  tax  was  npon  the 
right  of  succession  of  property,  or  upon  the  property. 
Matter  of  McPherson,  104  N.  Y.  306;  Matter  of  Sher- 
well,  125  N.  Y.  376. 

It  was  determined,  however,  in  the  Matter  of  Swift, 
137  N.  Y.  77,  that  the  tax  imposed  by  the  Act  of  1885, 
as  amended  by  the  Act  of  1887,  was  a  tax  upon  the  right 
of  succession  to  property,  and  not  a  property  tax. 
Other  cases  have  since  held  that  the  subsequent  acts  of 

[i] 


2  THE    TRANSFER   TAX   LAW. 

the  Legislature  affecting  taxable  transfers  impose  this 
tax  upon  the  right  of  succession  under  a  will,  or  devolu- 
tion in  case  of  intestacy.  Matter  of  Merriam,  141  N.  Y. 
479;  Matter  of  Hoffman,  143  N.  Y.  327  (decided  since 
the  Act  of  1892) ;  Matter  of  Western,  152  N.  Y.  93-99. 

In  the  Matter  of  Vanderbilt,  172  N.  Y.  69  (decided 
since  the  Act  of  1896),  the  Court  of  Appeals  held  that 
the  fact  that  a  tax  is  to  be  paid  out  of  the  property  does 
not  render  it  a  tax  on  property,  but  that  "  a  tax  is  a 
property  tax  when  imposed  by  reason  of  the  owner- 
ship; —  a  transfer  tax  when  imposed  on  the  method  of 
acquisition." 

In  the  case  of  Magoun  v.  Illinois  Trust  and  Savings 
Bank,  170  U.  S.  283,  the  court  says  in  support  of  an 
inheritance  tax  that  such  taxes  are  based  on  two  prin- 
ciples : 

"  (1)  An  inheritance  tax  is  not  one  on  property  but 
one  on  succession. 

"(2)  The  right  to  take  property  by  devise  or  de- 
scent is  the  creature  of  the  law  and  not  a  natural  right 
—  a  privilege,  and,  therefore,  the  authority  which  con- 
fers it  may  impose  conditions  upon  it.  From  these 
principles  it  is  deduced  that  the  State  may  tax  the 
privilege,  discriminate  between  relatives,  and  between 
these  and  strangers,  and  grant  exemptions,  and  is  not 
precluded  from  this  power  by  the  provisions  of  the 
respective  constitutions  requiring  uniformity  and 
equality  of  taxation. ' ' 

2.  The  Law  is  Constitutional. 

The  Act  of  1885  was  declared  constitutional  in  the 
Matter  of  McPharson,  104  N.  Y.  306.  Judge  Earl,  in 
writing  the  opinion  of  the  court,  in  which  all  concurred, 


THE   LAW    OF   TAXABLE   TRANSFERS.  .5 

says :  ' '  We  entertain  no  doubt  that  such  a  tax  can  be 
constitutionally  imposed.  The  power  of  the  Legis- 
lature over  the  subject  of  taxation,  except  as  limited  by 
constitutional  restrictions,  is  unbounded.  It  may  im- 
pose all  the  taxes  upon  lands,  or  all  upon  personal  prop- 
erty, or  all  upon  houses  or  upon  income  *  *  *.  It 
is  not  very  important  to  determine  whether  the  Act 
of  1885  is  to  be  regarded  as  imposing  a  tax  upon  prop- 
erty or  upon  the  succession  or  devolution  of  property 

by  will  or  intestacy.    In  either  ease  it  is  a  special  tax 

*     *     *  *  > 

To  the  same  effect,  see  Matter  of  Sherwell,  125  N.  Y. 
376. 

The  Act  of  1887  was  upheld  in  U.  S.  v.  Perkins,  163 
U.  S.  625,  Justice  Brown  of  that  court  saying  in  his 
opinion :  ' l  While  the  laws  of  all  civilized  states  recog- 
nize in  every  citizen  the  absolute  right  to  his  own  earn- 
ings, and  to  the  enjoyment  of  his  own  property,  and 
the  increase  thereof  during  his  life,  except  so  far  as  the 
State  may  require  him  to  contribute  his  share  for  public 
expenses,  the  right  to  dispose  of  this  property  by  will 
has  always  been  considered  purely  a  creature  of  stat- 
ute, and  within  legislative  control." 

The  Act  of  1892  was  upheld  in  the  Matter  of  Gould, 
156  N.  Y.  423,  the  court  holding  that  it  was  certainly 
within  the  constitutional  power  of  the  Legislature  to 
tax  all  property  transferred  by  will,  whether  the  motive 
was  to  make  a  gift  or  pay  a  debt. 

3.  Provisions  of  the  Act  Declared  Constitutional. 

Subdivision  5  of  section  220,  added  by  chapter  284, 
Laws  1897,  taxing  property  transferred  by  the  exer- 


THE    TRANSFER   TAX   LAW. 


cise  of  a  power  of  appointment,  is  constitutional  and 
not  a  violation  of  either  vested  or  contract  rights.  Mat- 
ter of  Vanderbilt,  50  App.  Div.  246,  63  N.  Y.  S.  1079; 
affd.,  163  N.  Y.  519,  on  opinion  below;  Matter  of  Potter, 
51  App.  Div.  212,  64  N.  Y.  S.  1013;  followed  in  Matter 
of  Vanderbilt,  58  App.  Div.  619,  68  N.  Y.  S.  1150;  affd., 
166  N.  Y.  640;  Matter  of  Delano,  176  N.  Y.  486. 

Chapter  76  of  the  Laws  of  1899  (§  230),  assessing 
immediately  the  tax  upon  contingent  estates  at  the 
highest  rate  which,  on  the  happening  of  any  of  the  said 
contingencies  or  conditions,  would  be  possible  and  mak- 
ing such  tax  due  and  payable  forthwith  out  of  the  prop- 
erty transferred,  was  held  constitutional  in  the  Matter 
of  Vanderbilt,  172  N.  Y.  69;  Matter  of  Brez,  172  N.  Y. 
609. 

Chapter  658,  Laws  of  1900,  relative  to  the  appoint- 
ment of  transfer  tax  appraisers  in  the  counties  of  New 
York,  Kings,  and  Erie,  was  declared  constitutional,  as 
it  was  not  a  local  act  and,  therefore,  did  not  come 
within  the  provisions  of  the  Constitution,  that  no 
private  or  local  bill  shall  embrace  more  than  one  sub- 
ject, which  shall  be  expressed  in  the  title.  Matter  of 
Wallace,  71  App.  Div.  284,  75  N.  Y.  S.  838. 

Chapter  173  of  the  Laws  of  1901  (§  230),  allowing  the 
county  treasurers  of  certain  counties  to  act  as  ap- 
praisers, although  retaining  a  certain  percentage  of 
all  transfer  taxes  paid  and  accounted  for  by  him  each 
year  as  a  part  of  his  fees,  was  held  constitutional  in  the 
Matter  of  Fuller,  62  App.  Div.  428,  71  N.  Y.  S.  40,  revg. 
same  case,  34  Misc.  Rep.  750. 


THE  LAW    OF   TAXABLE   TRANSFERS.  0 

4.  Constitutionality  of  Chapter  41,  Laws  of  1903. 

The  constitutionality  or  validity  of  chapter  41  of  the 
Laws  of  1903,  in  effect  March  16th  of  that  year,  amend- 
ing section  221  of  the  Transfer  Tax  Law,  so  as  to  im- 
pose a  tax  upon  the  transfer  of  real  as  well  as  per- 
sonal property  to  those  in  the  1-per-cent.  class,  has 
been  attacked  upon  a  somewhat  unusual  ground,  to-wit : 
That  the  certificate  of  the  Secretary  of  State  attached 
to  said  act,  invalidates  the  act,  in  that  it  states  that  it 
was  "  Passed  a  majority  being  present,"  whereas  sec- 
tion 25  of  article  III  of  the  Constitution  of  the  State, 
provides  as  follows : 

§  25.  On  the  final  passage  in  either  house  of  the  Legisla- 
ture, of  any  act  which  imposes,  continues  or  revives  a  tax,  or 
creates  a  debt  or  charge,  or  makes,  continues  or  revives  any 
appropriation  of  public  or  trust  money  or  property,  or  re- 
leases, discharges  or  commutes  any  claim  or  demand  of  the 
State,  the  question  shall  be  taken  by  yeas  and  nays,  which 
shall  be  duly  entered  upon  the  journals,  and  three-fifths  of 
all  the  members  elected  to  either  house  shall  in  all  such  cases, 
be  necessary  to  constitute  a  quorum  therein. 

In  the  Matter  of  Weeks  (not  reported),  the  decedent 
died  possessed  of  real  estate  in  this  State  valued  at 
$38,000,  which  she  devised  to  her  son,  and  upon  the 
confirmation  of  the  report  of  the  appraiser,  before  Sur- 
rogate Howell  of  Orange  county,  the  State  Comp- 
troller claimed  that  this  real  estate  was  taxable  at 
1  per  cent.,  the  decedent  having  died  subsequent  to 
the  passage  of  chapter  41  of  the  Laws  of  1903. 

The  executors  contended  that  only  a  majority  of  the 
Legislature  was  present  at  the  passage  of  this  act, 


6  THE    TRANSFER   TAX    LAW. 

and  that  the  evidence  of  this  fact  is  shown  by  the  orig- 
inal certificate  annexed  to  this  bill,  which  certificate  is 
required  to  be  annexed  by  the  presiding  officer  of  each 
house,  according  to  section  40  of  the  Legislative  Law, 
upon  the  passage  of  a  bill  where  three-fifths  of  the 
Legislature  are  constitutionally  required  to  be  present, 
and  that  chapter  41  as  published  in  the  Session  Laws  of 
1903  is  certified  to  have  been  passed  by  a  majority, 
and  not  in  the  presence  of  three-fifths  of  the  members 
of  both  houses. 

Section  40  of  the  Legislative  Law  reads  as  follows : 

Certificate  of  presiding  officer:  Upon  the  passage  of  a 
bill  or  concurrent  resolution  by  either  house,  the  presiding 
officer  thereof,  shall  append  to  such  bill  or  resolution,  a  cer- 
tificate of  the  date  of  its  passage  by  the  votes  of  a  majority 
of  all  the  members  elected  to  such  house  or  in  the  presence 
of  three-fifths  of  such  members,  if  such  be  the  case,  or  by  the 
votes  of  two-thirds  of  all  members  elected  to  such  house,  as 
the  case  may  be.  No  bills  shall  be  deemed  to  have  so  passed 
unless  certified  by  the  presiding  officer,  which  certificate  to 
such  effect  shall  be  conclusive  evidence  thereof. 

The  surrogate  in  entering  the  order  assessing  a  tax 
upon  this  real  estate  filed  a  memoranda  of  his  decision, 
the  important  part  of  which,  after  referring  to  the  ob- 
jection raised  by  the  executors,  is  as  follows : 

I  am,  therefore,  forced  to  the  conclusion  that  this  law 
was  passed  by  a  majority  vote,  and  not  by  three-fifths  of  the 
members  being  present,  and  that  the  constitutional  objection 
would  apply  to  this  act  "  which  imposes,  continues  or  re- 
vives a  tax,"  if  the  words  "  a  tax  "  mean  any  tax  and  to 
include  all  taxes.  We  find,  however,  that  these  same  words 
"An  act  which  imposes,  continues  or  revives  a  tax  "  used  in 
another  part  of  the  Constitution,  have  been  interpreted  by 


THE   LAW   OF   TAXABLE   TKANSFEKS.  7 

the  Court  of  Appeals  of  this  State  in  the  Matter  of  Mc- 
Phcrson,  reported  in  104  N.  Y.,  page  306,  where  it  was  held 
that  the  word  "  tax  "  as  used  in  the  expression,  "  which  im- 
poses, continues  or  revives  a  tax  "  means  a  general  tax,  an 
annual  recurring  tax,  and  does  not  include  any  special  tax. 

In  the  opinion  of  Earl,  Justice,  in  that  case,  the  following 
language  is  used : 

We  are  of  the  opinion  that  this  section  of  the  Constitution 
is  not  applicable  to  this  case.  In  terms  it  applies  to  every 
tax  which  the  Legislature  can  impose  and  is  not  confined  to 
a  property  tax.  It  is  not  even  by  its  terms  confined  to  a 
general  tax  embracing  the  whole  State ;  but  the  language, 
literally  construed,  is  broad  enough  to  embrace  every  local 
tax  imposed  for  local  purposes.  As  stated  above,  taxes  may 
be  imposed  upon  a  great  variety  of  objects.  They  may  be 
direct  or  indirect,  special  or  general,  and  they  may  be  im- 
posed in  the  shape  of  excise  and  licenses,  upon  hawkers, 
peddlers,  auctioneers,  insurance  agents,  liquor  dealers  and 
others.  All  the  contributions  for  the  support  of  the  govern- 
ment, enforced  from  individuals  in  the  various  ways  men- 
tioned, are,  properly  speaking,  taxes.  Notwithstanding  the 
general  language  of  the  section  referred  to,  we  do  not  think 
it  was  intended  to  apply  to  every  tax  which  the  Legislature 
could  impose,  and  so  it  has  been  held. 

The  object  of  the  constitutional  provision  was  to  convey 
information  to  the  members  of  the  Legislature  and  to  the 
people,  and  it  should  have  a  practical  construction  with  a 
view  to  accomplish  its  purpose  so  far  as  attainable,  and  to 
carry  out  the  policy  which  we  may  assume  dictated  it. 

The  tax  imposed  by  this  act  is  a  permanent  one.  It  is 
always  uncertain  upon  whom  it  will  fall  and  how  much 
revenue  it  will  produce.  It  would  have  been  impossible  for 
the  Legislature,  perhaps  years  in  advance,  to  specify  the 
particular  objects  to  which  the  tax  should  be  applied,  and 
we  are  of  the  opinion  that  this  section  of  the  Constitution 
was  intended  to  apply  to  the  annual  recurring  taxes  known 
at  the  time  of  the  adoption  of  the  Constitution  and  imposed 
generally  upon  the  entire  property  of  the  State.     The  Legis- 


O  THE    TRANSFER    TAX    LAW. 

lature  would  know  definitely  the  objects  for  which  such  taxes 
were  imposed  and  could  anticipate,  with  some  certainty,  the 
amount  which  they  would  produce ;  and  in  their  imposition 
it  was  deemed  important  by  the  framers  of  the  Constitution 
that  the  object  of  the  tax  should  be  stated.  But  we  do  not 
think  that  the  policy  embodied  in  the  section  had  any  refer- 
ence to  special  taxes  which  may  be  collected  in  a  variety  of 
ways  under  general  laws,  such  as  auction  duties,  excise  duties, 
taxes  on  business  or  particular  trades,  avocations  or  special 
classes  of  property. 

This  case  has  been  followed  in  the  Matter  of  Clark  v. 
Sheldon,  106  N.  Y.  104,  and  in  the  Matter  of  the  Will  of 
Vassar,  127  N.  Y.  1. 

I  conclude,  therefore,  that  these  words,  "An  act  which 
imposes,  continues  or  revives  a  tax  "  as  used  in  the  Constitu- 
tion, have  been  defined  and  interpreted  by  the  highest  court 
of  this  State,  and  that  this  language  is  not  to  be  interpreted 
as  applying  to  any  and  all  taxes,  but  only  the  annual  re- 
curring general  taxes,  and  that  the  tax  in  question,  the  trans- 
fer tax,  is  a  special  tax  and  that  the  constitutional  provision, 
therefore,  does  not  affect  it.  The  order  to  be  made  herein 
will,  therefore,  include  a  provision  fixing  a  tax  of  1  per  cent, 
upon  the  reported  value  ($38,000)  of  the  real  estate  passing 
from  the  decedent  to  her  son,  Thomas  W.  Weeks. 

Upon  appeal  to  the  surrogate,  the  order  was  affirmed 
June  12,  1905,  upon  the  further  ground  that  from  the 
journals  of  the  Senate  and  Assembly  respectively,  for 
the  year  1903,  it  appears  that  the  act  was  passed  by  a 
majority,  three-fifths  being  present. 

This  same  question  was  first  raised  by  appeal  in  the 
Matter  of  Stickney  before  Surrogate  Fitzgerald  of 
New  York  county,  and  the  Law  Journal  of  June  9, 
1905,  contains  the  opinion  of  the  surrogate,  affirming 
the  order  assessing  the  tax  and  holding  the  law  con- 
stitutional.    It  appears  that  in  June  of  1904  certain 


THE  LAW   OF   TAXABLE   TRANSFERS.  9 

amended  certificates  were  made  by  the  ex-president 
of  the  Senate  of  1903  and  the  ex-speaker  of  the  As- 
sembly of  that  session,  and  were  filed  in  the  office  of 
the  Secretary  of  State  and  attached  to  the  original 
act,  which  read  that  the  bill  was  duly  passed,  a  major- 
ity of  all  the  members  voting  in  favor  thereof,  three- 
fifths  being  present. 

On  the  hearing  before  the  appraiser  the  Comptroller 
introduced  in  evidence  extracts  from  the  journals  of 
the  respective  houses,  which  establish  that  on  the  final 
passage  of  the  bill  the  requisite  three-fifths  were  pres- 
ent. The  appellants  claim  that  the  original  act  and 
certificates  are  conclusive;  that  the  amended  certifi- 
cates and  affidavits  filed  therewith  were  inadmissible 
in  evidence,  as  incompetent,  and  that  the  amended  cer- 
tificates were  appended  to  the  original  bill  without 
authority  of  law.  They  also  contended  that  neither 
the  extracts  from  the  Journals,  nor  the  Journals  them- 
selves, are  legitimate  evidence,  as  they  were  not  rec- 
ords by  common  law  and  have  not  been  made  so  by 
statute. 

Before  1892  there  was  no  provision  of  law  making 
the  certificate  of  the  presiding  officer  conclusive  evi- 
dence as  to  the  manner  in  which  bills  were  passed,  and 
the  surrogate  in  his  opinion  states  that,  as  an  import- 
ant fact  to  be  kept  in  mind,  as  no  decision  by  the  courts 
of  this  State  has  been  cited  which  arose  under  a  law 
enacted  subsequent  to  the  Legislative  Law.  (Chap. 
482,  Laws  1892,  as  amended.) 

The  court  says:  "  In  the  present  case,  however,  I 
do  not  think  that  I  am  confronted  with  a  situation  pre- 
senting a  question  as  to  the  constitutionality  of  the  Act 


10  THE    TRANSFER    TAX    LAW. 

of  1892  prescribing  the  conclusiveness  as  evidence  of 
the  certificate  therein  specified.  The  statement  ap- 
pended to  the  Session  Law  relative  to  the  law  in  ques- 
tion, is  only  made  presumptive  evidence  that  the  orig- 
inal law  was  certified  by  the  proper  officers  in  the  man- 
ner stated.  The  statement  obviously  does  not  con- 
form to  the  certificates  of  such  officers  to  the  original 
law,  and  whatever  may  be  taken  to  be  its  meaning,  or 
its  intended  effect,  it  is  open  to  contradiction  by  com- 
petent proof.  The  certificates  attached  to  the  original 
law,  as  far  as  they  go,  prove  themselves,  or,  to  that  ex- 
tent are  made  conclusive  by  the  Act  of  1892  (Chap.  482, 
as  amended)  on  the  assumption  that  it  is  a  valid  law, 
and  so  far  as  they  omit  to  state  the  fact  as  to  the  act 
having  been  passed  in  presence  of  three-fifths  of  the 
members  elected  to  each  house,  the  certificates  were 
incomplete  and  defective  and  there  is  nothing  in  the 
Act  of  1892  last  mentioned,  in  the  view  I  take  of  it,  in- 
compatible with  the  right  of  the  presentation  of  com- 
petent proof  on  the  subject.  The  journals  which  have 
been  received  in  evidence  I  consider  such  proof,  and 
they  prove  that  the  requisite  quorum  was  present  on 
the  final  passage  of  the  act  in  question  and  this  evi- 
dence supersedes  the  incomplete  and  defective  certifi- 
cates of  the  presiding  officers." 

The  surrogate  then  refers  at  length  to  the  opinion  of 
the  court  in  People  ex  rel.  v.  Supervisors,  8  N.  Y.  317; 
Darlington  v.  Mayor,  etc.,  2  Robt.  277;  affd.,  31  N.  Y. 
164;  Rumseij  v.  N.  Y.  &  N.  E.  R.  R.,  130  N.  Y.  88,  and 
Matter  of  N.  Y.  &  L.  I.  Bridge  Co.,  148  N.  Y.  540-555, 
the  Court  of  Appeals  in  the  last  case  saying  (p.  555) : 
"  We  think  the  journals  of  the  Senate  and  Assembly 


THE  LAW  OF  TAXABLE  TRANSFERS.  11 

were  properly  received  in  evidence  and  they  show  con- 
clusively that  the  Act  of  1892  received  a  two-thirds 
vote  *  *  *  the  journals  were  offered  in  evidence 
not  for  the  purpose  of  contradicting  the  certificates, 
but  to  supplement  them,  as  they  were  defective.  We 
think  it  would  defeat  the  provisions  of  the  Constitu- 
tion and  the  statute  if,  in  such  an  emergency  as  was 
here  presented,  recourse  could  not  be  had  to  the  jour- 
nals of  the  two  houses." 

The  surrogate,  in  affirming  the  order,  stated  that 
in  his  opinion  the  amended  certificates  and  affidavits 
of  the  presiding  officers  were  incompetent  evidence. 

The  validity  of  chapter  41  will  doubtless  be  further 
contested  by  the  representatives  of  the  estate,  as  there 
are  a  large  number  of  appeals  in  other  estates  pending 
which  have  been  held  in  abeyance  awaiting  the  Stick- 
ney  decision. 

5.  Unconstitutional  Provision;  Chapter  76  of  the  Laws  of  1899, 
Amending  Section  230  of  the  Act  of  1896. 

Section  230  of  the  Act  of  1896  was  amended  by  chapter 
76  of  the  Laws  of  1899  by  providing  that  "All  estates  upon 
remainder  or  reversion  which  vested  prior  to  June  thirtieth, 
eighteen  hundred  and  eighty-five,  but  which  will  not  come 
into  actual  possession  or  enjoyment  of  the  person  or  corpora- 
tion beneficially  interested  therein  until  after  the  passage  of 
this  act  -lull  be  appraised  and  taxed  as  soon  as  the  person  or 
corporation  beneficially  interested  therein  shall  be  entitled 
id  tin   actual  possession  or  enjoyment  thereof." 

This  provision  was  declared  unconstitutional  by  the 
Court  of  Appeals  in  the  Matter  of  Pell,  171  N.  Y.  48, 
the  court  holding  that  to  attempt  to  impose  a  tax  in 
such  a  case,  based  on  the  succession,  would  be  to  dim  in- 


12  THE    TRANSFER   TAX   LAW. 

ish  the  value  of  vested  estates,  to  impair  the  obligation 
of  a  contract,  and  to  take  private  property  for  public 
use  without  compensation. 

The  question  arose  under  a  will  which  took  effect  in 
1863,  whereby  the  testator  Pell  had  given  his  wife  a 
life  estate  in  his  property  with  remainder  over  at  her 
death  to  certain  nephews  and  nieces  or  their  issue,  and 
to  a  sister.  The  widow  died  in  1899,  and  it  was  then 
sought  to  tax  the  remainder  interests  which  then 
vested  in  possession.  The  Appellate  Division  (60 
App.  Div.  286,  70  N.  Y.  S.  196)  held  that  if,  under  the 
Transfer  Tax  Law,  nothing  could  be  taxed  but  the 
right  of  succession,  then,  as  that  right  passed  in  1863, 
the  property  was  not  taxable,  but  they  evidently 
viewed  the  provisions  of  the  Transfer  Tax  Law  tax- 
ing the  property  of  a  nonresident,  and  gifts  causa 
mortis,  as  a  tax  upon  property,  and  held  that  the  tax 
in  question  could  be  sustained  as  a  tax  upon  property, 
thus  eliminating  all  constitutional  objections  in  refer- 
ence to  impairing  the  vested  rights  of  the  remainder- 
men. 

By  chapter  173  of  the  Laws  of  1901  this  provision 
was  amended  by  applying  its  provisions  only  to  re- 
mainders and  reversions  vesting  before  May  1,  1892, 
but  after  the  decision  of  the  Court  of  Appeals,  revers- 
ing the  Appellate  Division  in  the  Pell  case,  was  handed 
down  May  6,  1902,  and  subsequent  to  this  last  amend- 
ment, no  attempt  has  been  made  since  to  assess  a  tax 
upon  such  vested  remainders,  and  the  entire  provision 
was  omitted  in  the  amendment  to  section  230  by  chap- 
ter 368  of  the  Laws  of  1905. 


THE  LAW   OF   TAXABLE   TRANSFERS.  13 

6.  The  Value  of  the  Whole  Estate  Transferred  to  Taxable 
Persons  Determines  the  Liability  of  Each  Transfer  to 
Taxation. 

Prior  to  the  Act  of  1892  the  amount  of  each  legacy, 
distributive  share,  or  other  interest  was  considered 
separately  for  the  purpose  of  determining  whether  the 
taxable  limitation  was  equaled  or  exceeded,  and  the 
word  "  estate  "  was  held  to  refer  to  the  estate  passing 
to  the  beneficiary,  and  not  the  aggregate  estate  of  the 
decedent.  Matter  of  Cager,  111  N.  Y.  343;  Matter  of 
Hoice,  112  N.  Y.  100;  Matter  of  Westurn,  152  N.  Y. 
93-99. 

By  section  22  of  the  Act  of  1892  the  words  "  estate  '; 
and  ' '  property  ' '  were  defined  ( substantially  the  same 
as  in  section  242  of  the  Act  of  1905)  to  mean  the  prop- 
erty or  interest  therein  of  the  testator  intestate, 
grantor,  bargainor,  or  vendor,  passing  or  transferred 
to  those  not  herein  specifically  exempted  from  the  pro- 
visions of  the  act,  and  not  as  the  property  or  interest 
therein  passing  or  transferred  to  individual  legatees, 
devisees,  etc.,  and  the  Court  of  Appeals,  in  the  Matter 
of  Hoffman,  143  N.  Y.  327,  in  construing  the  provi- 
sions of  this  section,  held  that  it  was  the  aggregate 
amount  of  the  estate  passing  to  taxable  persons  and 
not  the  share  of  any  particular  legatee  or  distributee 
which  determines  the  liability  to,  or  exemption  from, 
the  tax,  although  the  fact  remains  that  the  amount  of 
tax  is  determined  by  reference  to  the  value  of  each 
legacy  or  distributive  share  and  not  by  reference  alone 
to  the  decedent's  aggregate  estate.  In  the  Matter  of 
Bliss,  6  App.  Div.  192,  39  N.  Y.  S.  875,  the  court  held 


14  THE    TRANSFER   TAX   LAW. 

that,  where  a  testator  leaves  an  estate  of  $829.16,  giv- 
ing $414.58  to  his  sister  and  $207.29  to  each  of  two 
nephews,  the  legacies  to  the  nephews  are  not  taxable, 
as  the  legacy  to  the  sister  (being  less  than  $10,000)  is 
"  specifically  exempted  "  within  the  meaning  of  the 
statute,  and  the  amount  passing  to  the  two  nephews 
was  less  than  $500. 

In  the  Matter  of  Corbett,  171  N.  Y.  516,  the  Court 
of  Appeals,  following  the  Matter  of  Hoffman  {supra), 
held  that  it  was  the  intent  of  the  Legislature  to  pro- 
vide that  all  of  the  testator's  property,  passing  to 
those  not  specifically  exempted  from  taxation,  is  to  be 
included  in  determining  whether  the  amount  of  the 
personal  estate  passing  is  of  the  value  of  $10,000; 
that  the  statute  only  "  specifically  exempted  '  a 
bishop  or  religious  corporation  (at  that  time)  from 
the  provisions  of  the  act,  and  that  where  a  brother 
and  sister  are  each  entitled  to  one-third  of  an  estate 
valued  at  $11,880.69,  and  two  nieces  are  each  entitled  to 
the  remaining  one-third,  that  the  portion  thereof  pass- 
ing to  the  brother  and  sister  is  taxable  at  1  per  cent., 
although  when  considered  alone  the  amount  passing 
to  the  1-per-cent.  class  was  less  than  the  $10,000 
limitation.  The  effect  of  this  decision  was  to  over- 
rule the  Matter  of  Bliss  {supra),  and  establish  that 
both  the  1-per-cent.  and  the  5-per-cent.  class  are  "  tax- 
able i3ersons."  The  practice  of  taxing  all  transfers 
to  those  in  the  5-per-cent.  class,  where  the  aggregate 
amount  transferred  to  both  classes  of  taxable  persons 
was  over  $500,  but  less  than  $10,000,  has  been  followed 
in  many  counties  since  the  Act  of  1892,  and  this  prac- 
tice seems  now  to  be  fully  established  by  the  recent 


THE   LAW    OF    TAXABLE    TRANSFERS.  15 

decisions.  See  Matter  of  Rosendahl,  40  Misc.  Rep. 
542,  82  N.  Y.  S.  992;  Matter  of  Garland,  88  App.  Div. 
380,  84  N.  Y.  S.  630 ;  Matter  of  McMurray,  96  App.  Div. 
129,  89  N.  Y.  S.  71  (overruling  Matter  of  Conklin,  39 
Misc.  Rep.  771,  80  N.  Y.  S.  1124,  and  affirming  an 
earlier  decision  on  this  same  question,  Matter  of  Hall, 
88  Hun,  68,  34  N.  Y.  S.  616). 

By  the  amendment  to  section  221  by  chapter  41  of 
the  Laws  of  1903,  in  effect  March  16th  of  that  year 
(re-enacted  by  chapter  368  of  the  Laws  of  1905,  with- 
out amendment),  the  law  imposed  a  tax  upon  real 
property  as  well  as  personal  property  passing  to  those 
in  the  1-per-cent.  class  of  taxable  persons,  and  the 
question  arose  as  to  whether  it  was  intended  that  both 
the  real  property  and  the  personal  property  must  sev- 
erally be  of  the  value  of  $10,000  before  it  was  taxable, 
or  whether  the  value  of  the  two  classes  of  property 
was  to  be  considered  together  for  the  purpose  of  ascer- 
taining if  the  taxable  limitation  had  been  reached.     In 
the  Matter  of  Hallock,  42  Misc.  Rep.  473,  87  N.  Y.  S. 
255,  a  brother  devised  and  bequeathed  to  his  sister 
all  his  real  estate  of  the  value  of  $6,500,  and  personal 
property    exceeding    $10,000    in    value,    and    it    was 
claimed  on  the  part  of  the  estate  that  the  values  of 
the  real  and  personal  property  were  not  to  be  added 
together;  that  real  property  passing  to  a  sister  was 
only    taxable    when,    considered    alone,    it    exceeded 
$10,000   in   value.      The   court  held  that,   since   this 
amendment,  it  was  the  intention  of  the  law  to  impose 
the  tax  on  the  property,  ' '  real  or  personal ; ' '  that  is 
to  say,  "  of  whatever  kind,"  or  "  without  regard  to 
its  character,"  and  that  the  aggregate  value  of  the 


16  THE    TRANSFER   TAX   LAW. 

real  and  the  personal  property  passing  to  the  sister 
was  taxable  at  1  per  cent.  To  the  same  effect  see 
Matter  of  Fisher,  96  App.  Div.  133,  89  N.  Y.  S.  102. 

In  view  of  the  fact  that  the  real  object  of  this  amend- 
ment was  to  make  real  property  equally  taxable  with 
personal  property,  it  is  doubtful  if  this  precise  ques- 
tion will  ever  be  submitted  to  the  Court  of  Appeals 
for  determination,  in  view  of  the  construction  given 
to  section  22  of  the  Act  of  1892,  defining  the  words 
"  estate  "  and  "  property  "  (now  section  242  of  the 
Act  of  1905)  by  that  court  in  the  Matter  of  Hoffman, 
143  N.  Y.  327. 

7.  The  Nature  of  the  Tax. 

The  earlier  decisions  held  that  the  taxes  imposed 
by  the  act  are  special  and  not  general;  and  the  rule 
is  that  special  tax  laws  are  to  be  construed  strictly 
against  the  government  and  favorably  to  the  taxpayers. 
A  citizen  cannot  be  subjected  to  special  burdens  with- 
out clear  warrant  of  law.  Any  doubt  should  be  re- 
solved in  favor  of  the  taxpayer.  Matter  of  Enston, 
113  N.  Y.  174;  Matter  of  Vassar,  127  N.  Y.  1;  Matter 
of  Fayenveather,  143  N.  Y.  114;  Matter  of  Harbeck, 
161  N.  Y.  211.  Courts  have  no  general  powers  of 
jurisdiction  in  these  proceedings;  the  only  authority 
is  to  be  found  in  the  act  itself.  The  jurisdiction  is 
special  and  specially  conferred  by  the  act.  Matter  of 
Smith,  40  App.  Div.  480,  58  N.  Y.  S.  128. 

8.  Procedure;  Statute  Governing. 

The  method  of  procedure  in  a  proceeding  for  the 
ascertainment  and  determination  of  a  transfer  tax 


THE  LAW  OF  TAXABLE  TRANSFERS.  17 

is  controlled  by  the  statute  on  the  subject  in  force 
at  the  time  of  the  institution  of  the  proceeding,  al- 
though the  tax  itself  and  the  rights  of  the  parties  are 
controlled  by  an  earlier  statute.  Therefore,  in  a  pro- 
ceeding instituted  in  1896,  upon  the  determination  of 
the  particular  estate,  to  ascertain  the  amount  of  tax 
upon  a  legacy  in  remainder  under  the  will  of  the  tes- 
tator, who  died  in  1890,  the  rights  of  the  parties  de- 
pend upon  the  statute  as  amended  in  1887  (chapter 
713),  but  the  method  of  procedure  depends  upon  the 
statute  of  1892  (chapter  399).  Matter  of  Sloane,  154 
N.  Y.  109;  Matter  of  Davis,  149  N.  Y.  539. 

9.  Amendments  are  not  Retroactive  Unless  Stated  to  be. 

The  various  amendatory  acts  referred  to  in  the  foot- 
notes to  the  different  sections  have  not  been  construed 
to  have  any  retroactive  effect  except  such  intention 
was  clearly  shown  by  the  language  used. 

In  the  Matter  of  Van  Kleeck,  121  N.  Y.  701,  the 
Court  of  Appeals  said:  "  But  legislative  acts  are  al- 
ways construed  as  prospective  in  their  operation,  un- 
less by  their  plain  language  it  can  be  seen  that  it  was 
the  legislative  intention  that  they  should  have  retro- 
active effect."  To  the  same  effect,  Matter  of  Seaman, 
147  N.  Y.  69. 

Subdivision  3  of  section  1  of  the  Act  of  1892  em- 
braced substantially  the  provisions  contained  in  sub- 
divisions 3,  4,  and  6  of  section  220  of  the  Act  of  1896, 
and  is  the  same  as  the  corresponding  subdivision  of 
section  220  of  the  Act  of  1905,  and,  in  referring  to  the 
portion  thereof  which  is  now  contained  alone  in  subdi- 
2 


18  THE    TRANSFER   TAX   LAW. 

vision  3,  the  Court  of  Appeals,  in  the  Matter  of  Sea- 
man, 147  N.  Y.  69,  76,  77,  said  that  this  provision  was 
to  be  construed  as  affecting  grants  or  gifts  causa 
mortis,  and  does  not  include  transfers  by  will  or  intes- 
tacy, so  as  to  subject  to  taxation  rights  of  succession 
which  accrued  before  the  statute  came  into  existence, 
thus  making  the  act  retrospective  in  its  operation. 

The  exemption  of  bishops  and  religious  corpora- 
tions by  chapter  169,  Laws  of  1892,  and  continued  in 
the  Acts  of  1892  and  1896,  was  retroactive.  Roman 
Catholic  Church  v.  Niles,  86  Hun,  221.  The  words 
11  heretofore  or  hereafter  "  were  omitted  from  the 
provisions  of  section  221  exempting  bequests  to  a 
bishop  and  to  certain  corporations,  as  amended  and 
re-enacted  by  chapter  368,  Laws  of  1905. 

It  seems  that  a  repeal  of  a  statute  of  limitations  may 
lawfully  be  retroactive.  Matter  of  Moenich,  39  Misc. 
Rep.  480,  80  N.  Y.  S.  222.  See  Matter  of  Hoople,  179 
N.  Y.  308,  as  to  the  effect  of  the  two-year  limitation 
relative  to  refunds  under  section  225. 

An  amendatory  statute  has  no  retroactive  effect  un- 
less such  a  legislative  intent  is  discoverable  in  the 
act.     Matter  of  Miller,  110  N.  Y.  216. 

The  provisions  of  section  230,  ' '  Whenever  an  estate 
for  life  or  for  years  can  be  divested  by  the  act  or 
omission  of  the  legatee  or  devisee,  it  shall  be  taxed  as 
if  there  were  no  possibility  of  such  limitation,"  has 
no  retroactive  effect,  and  applies  only  to  the  life  es- 
tate, not  to  the  reversion.  Matter  of  Sloane,  154  N.  Y. 
109,  affg.  same  case,  19  App.  Div.  411,  46  N.  Y.  S.  264. 


THE  LAW   OF   TAXABLE   TRANSFERS.  19 

10.  Corresponding  Sections  of  Former  Acts  Relating  to  Tax- 
able Transfers. 

Section  1,  chapter  483,  Laws  of  1885  not  only  defined  the 
taxable  transfers,  but  also  contained  provisions  relating  to 
the  exemptions  and  limitations,  which  were  afterward  placed 
in  section  2  of  the  Act  of  1892.  The  Act  of  1885  became  a 
law  June  30th  of  that  year  and  imposed  a  tax  of  five  dollars 
upon  each  hundred  dollars  of  property  transferred  by  will  or 
the  intestate  laws  of  this  State,  or  by  deed,  grant,  sale  or  gift 
made  or  intended  to  take  effect  in  possession  or  enjoyment/ 
after  the  death  of  the  grantor  or  bargainor,  to  any  person  or 
persons,  or  to  a  body  politic  or  corporate,  in  trust  or  other- 
wise, or  by  reason  whereof  any  person  or  body  politic  or 
corporate  shall  become  beneficially  entitled  in  possession  or 
expectancy,  to  any  property  or  to  the  income  therefrom,  other 
than  to  or  for  the  use  of  a  father,  mother,  husband,  wife, 
children,  brother  and  sister,  and  lineal  descendants  born  in 
lawful  wedlock  and  the  wife  or  widow  of  a  son  and  the  hus- 
band of  a  daughter,  and  the  societies,  corporations,  and  in- 
stitutions now  exempt  by  law  from  taxation;  provided  that 
an  estate  valued  at  less  than  $500  shall  not  be  subject  to 
such  tax. 

Chapter  713,  Laws  of  1887,  in  effect  June  25th  of  that 
year,  amended  section  1  so  as  to  impose  a  tax  upon  the  prop- 
erty of  a  nonresident  decedent  within  this  State  at  the  time 
of  such  nonresident's  death.  It  also  included  in  the  list  of 
exempt  persons  an  adopted  child  or  children  of  decedent,  or 
any  person  to  whom  the  deceased  for  not  less  than  ten  years 
prior  to  his  death  stood  in  the  mutually  acknowledged  rela- 
tion of  a  parent. 

Chapter  215,  Laws  of  1891,  in  effect  April  20th  of  that 
year,  further  amended  section  1  by  including  any  transfer 
"  made  in  contemplation  of  the  death  of  the  grantor  or 
bargainor,"  as  a  taxable  transfer.  By  this  amendment  it  was 
further  provided  that  all  transfers  of  personal  property  to  or 
for  the  use  of  any  father,  mother,  husband,  wife,  child, 
brother,  sister,  wife  or  widow  of  a  son  or  the  husband  of  a 


20  THE    TKANSFER   TAX   LAW. 

daughter,  or  any  child  or  children  adopted  as  such  in  con- 
formity with  the  laws  of  the  State  of  New  York,  or  to  any 
person  to  whom  the  deceased  for  not  less  than  ten  years  prior 
to  death  stood  in  the  mutually  acknowledged  relation  of  a 
parent,  or  to  any  lineal  descendant  born  in  lawful  wedlock, 
were  subject  to  a  tax  of  one  dollar  on  every  hundred  dollars, 
or  fractional  part  thereof ;  provided  that  an  estate  which  may 
be  valued  at  a  less  sum  than  $10,000  shall  not  be  subject  to 
any  such  tax. 

Chapter  169,  Laws  of  1892,  in  effect  March  19th  of  that 
year,  amended  section  1  by  adding  at  the  end  thereof  the 
following :  "  Provided  further  that  any  property  heretofore 
devised  or  bequeathed,  or  which  may  hereafter  be  devised 
or  bequeathed  to  any  person  who  is  a  bishop  or  to  any  reli- 
gious corporation  shall  be  exempted  from  and  not  be  subject 
to  the  provisions  of  this  act." 

Chapter  399,  Laws  of  1892,  in  effect  May  1st  of  that  year, 
repealed  the  Act  of  1885  and  all  amendments  thereto,  and 
revised  the  prior  laws  relating  to  taxable  transfers,  section 
1  of  said  act  relating  solely  to  taxable  transfers  of  property 
of  both  resident  and  nonresident  decedents,  and  section  2  of 
said  act  relating  solely  to  the  exemptions  and  limitations 
provided  for  in  said  act. 

In  1896  the  Commissioners  of  Statutory  Revision  who  had 
been  directed  to  prepare  and  present  to  the  Legislature  a  bill 
for  the  consolidation  and  revision  of  the  general  statutes  of 
the  State  relating  to  the  collection  and  assessment  of  taxes, 
and  the  exemptions  of  property  from  taxation  throughout  the 
State,  presented  to  the  Legislature  "  The  Tax  Law,"  entitled 
"An  act  in  relation  to  taxation,  constituting  chapter  24  of  the 
general  laws,"  wThich  subsequently  became  chapter  908,  Laws 
of  1896,  and  included,  with  certain  amendments,  chapter  399 
of  the  Laws  of  1892,  which  became  article  10  of  the  Tax 
Law,  section  1  of  the  Act  of  1892  becoming  section  220  of 
the  Act  of  1896. 

Chapter  284,  Laws  of  1897,  in  effect  April  16th  of  that 
year,  amended  section  220  by  dividing  subdivision  3  of  said 


THE  LAW  OF  TAXABLE  TRANSFERS.  21 

section  into  subdivisions  3,  4,  and  6,  as  above  stated,  and 
adding  subdivision  5,  which  was  a  new  provision. 

11.  Amendments  by  Chaper  368,  Laws  of  1905. 

Chapter  368,  Laws  of  1905,  in  effect  June  1st  of  that  year, 
re-enacts  with  certain  amendments  the  provisions  of  article 
10  of  chapter  908  of  the  Laws  of  1896  as  amended.  Xo 
material  change  is  made  affecting  the  substantive  law  as  con- 
tained in  chapter  908  aforesaid,  as  amended,  but  many 
changes  in  phraseology,  or  by  reason  of  rearrangement  of  the- 
various  provisions,  that  is,  taking  certain  provisions  from 
one  section  and  embodying  them  in  another  section  contain- 
ing provisions  of  a  similar  nature,  have  been  made,  so  as  to 
make  the  act  more  consistent  in  its  arrangement,  and  more 
available  for  reference. 

The  more  important  changes  are  as  follows : 

1.  The  existing  provision  of  section  221  relating  to  "  mutu- 
ally acknowledged  relationship,"  is  further  qualified  by  in- 
serting the  words,  "  and  provided  also,  that  the  parents  of 
such  child  shall  be  deceased  when  such  relationship  com- 
menced." 

2.  Section  221  of  the  act,  as  amended,  also  exempts  de- 
vises or  bequests  to  "  educational,  charitable,  missionary, 
benevolent,  hospital,  or  infirmary  corporations."  The  spe- 
cific exemptions  will  only  apply  to  bequests  or  devises  by 
decedent's  dying  subsequent  to  June  1,  1905,  as  the  words 
"  heretofore  or  hereafter,"  which  gave  the  provision  of 
former  section  221  a  retroactive  effect  in  respect  to  bequests 
to  a  bishop  or  a  religious  corporation,  have  been  omitted.  The 
rule  established  in  the  Matter  of  Prime,  136  X.  Y.  347  — 
that  such  exemptions  apply  only  to  domestic  corporations  — 
will  limit  the  above  exemptions  to  corporations  organized 
under  the  laws  of  this  State. 

3.  Section  226  of  the  former  statute  providing  for  deferred 
payments  is  omitted,  inasmuch  as  the  provisions  of  such  sec- 
tion are  now  obsolete  since  the  enactment  of  chapter  76  of  the 
Laws  of  1899,  providing  for  the  immediate  taxation  of  all 


22  THE    TRANSFER   TAX   LAW. 

future  and  contingent  estates,  and  the  payment  of  the  tax 
out  of  the  property  transferred  in  trust. 

4.  Section  227  providing  for  the  liabilities  of  certain  cor- 
porations has  been  amended  so  as  to  impose  further  con- 
ditions and  requirements  upon  trust  companies,  banks,  and 
other  depositories  relating  to  the  transfer  of  stock  or  other 
property  of  decedents,  and  the  delivery  of  the  contents  of  safe- 
deposit  boxes  rented  in  the  joint  name  of  the  decedent  and 
one  or  more  persons. 

5.  The  last  provision  in  the  old  section  230,  providing  for 
the  taxation  of  remainders  vesting  prior  to  Ma}7  1,  1892,  has 
been  omitted,  such  provision  having  been  declared  uncon- 
stitutional in  the  Matter  of  Pell,  171  K  Y.  48. 

6.  Section  231  requires  the  surrogate  to  "  forward  to  the 
State  Comptroller  a  copy  of  the  original  taxing  order,  and 
also  copies  of  all  orders  entered  by  him  in  relation  to  or 
affecting  in  any  way  the  transfer  tax  on  any  estate,  including 
orders  of  exemption,"  instead  of  forwarding  simply  a  notice 
of  assessment  of  the  tax  as  heretofore. 

7.  By  section  234,  assistants  and  clerks  in  the  twelve 
counties  therein  mentioned  are  appointed  by  the  Comptroller 
upon  the  recommendation  of  the  surrogate,  instead  of  by  the 
surrogate,  as  heretofore. 

8.  The  other  changes  relate  to  changes  in  phraseology, 
form,  or  rearrangement  of  the  provisions  already  existing,  as 
will  appear  by  reference  to  the  various  sections. 


CHAPTER  II. 


The  General  Subject  Continued. 


12.  Meaning  of  the  word   "trans- 

fer." 

13.  When  the  transfer  takes  place. 

14.  When  tax  attaches  to  legacy. 

15.  Tax  will  attach  upon  the  dev- 

olution of  title. 

16.  Transfer  of  title;  time  of. 

17.  When  legal  and  equitable  title 

vests. 

18.  Amount    of    tax ;     how    meas- 

ured. 

19.  Meaning    of    provision    "  when 

person    becomes    beneficially 
entitled."  etc. 


20.  Meaning  of  the  word  "  estate  " 

prior  to  Act  of  1892. 

21.  To  what  the  word  "deed"  re- 

fers to  in  this  act. 

22.  The  term  "  intestate  laws." 

23.  Intestate      law;      distribution 

among  collaterals. 

24.  Equitable  conversion ;  could  not 

be  invoked. 

25.  Where  legatee  dies  before  con- 

version takes  place. 
20.  Renunciation  of  legacy;  tax  is 
then  upon  the  ultimate  dev- 
olution. 


12.  Meaning  of  the  Word  "  Transfer." 

"A  tax  shall  be  and  is  hereby  imposed  upon  the 
transfer  of  any  property  *  *  *."  (§  220  of  the 
Transfer  Tax  Law.) 

The  Court  of  Appeals,  in  the  Matter  of  Gould,  156 
N.  Y.  423,  construes  the  word  "  transfer  "  as  used 
in  this  act  as  follows:  "It  is  certainly  within  the 
constitutional  power  of  the  Legislature  to  tax  all  prop- 
erty by  will,  whether  the  motive  of  the  testator  be  to 
make  a  gift,  or  pay  a  debt,  and  the  language,  abso- 
lutely unambiguous  and  free  from  saving  clauses, 
which  the  Legislature  employed  to  accomplish  that 
result,  affords  the  best  indication  that  the  word 
'  transfer  '  in  the  statute  is  used  advisedly  and  ac- 
cording to  its  ordinary  legal  signification,  which  is 
that  the  owner  of  a  thing  delivers  it  to  another  person 

[23] 


24  THE   TRANSFER    TAX   LAW. 

with  the  intent  of  passing  the  rights  which  he  has  in 
it  to  the  latter.  It  matters  not  what  the  motive  of  a 
transfer  by  will  may  be,  whether  to  pay  a  debt,  dis- 
charge some  moral  obligation,  or  to  benefit  a  relative 
for  whom  the  testator  entertains  a  strong  affection, 
if  the  devise  or  bequest  be  accepted  by  the  beneficiary, 
the  transfer  is  made  by  will,  and  the  State  by  the  stat- 
ute in  question  makes  a  tax  to  impinge  upon  that  per- 
formance. ' ' 

"  Transfer  "  means  the  passing  of  property  in  pos- 
session or  enjoyment,  present  or  future,  without  re- 
gard to  whether  the  actual  possession  and  enjoyment 
follow  immediately  or  come  at  some  future  time. 
Matter  of  Hitchins,  43  Misc.  Rep.  485,  89  N.  Y.  S.  472; 
affd.,  92  N.  Y.  S.  1128;  affd.,  181  N.  Y.  Mem.  51,  no 
opinion. 

13.  When  the  Transfer  Takes  Place. 

The  Court  of  Appeals,  in  the  Matter  of  Seaman,  147 
N.  Y.  69-76,  in  referring  to  the  time  when  a  transfer 
takes  place  under  subdivisions  1  and  2  of  section  1  of 
the  Act  of  1892,  which  are  the  same  as  subdivisions  1 
and  2  of  section  220  of  the  Act  of  1896,  and  corre- 
sponding section  of  the  Act  of  1905,  says  that  the  first 
and  second  subdivisions  aforesaid  embrace  transfers 
of  property,  by  will  or  intestate  laws,  of  residents  or 
nonresidents,  and  that  "  so  far,  the  transfers  take 
place  necessarily  at  the  moment  of  death,  for  the  will 
on  the  one  hand  and  the  intestate  laws  on  the  other 
operate  and  speak  from  that  date,  and  any  special 
provision  about  that  was  needless.'* 


THE  LAW  OF  TAXABLE  TRANSFERS.  25 

14.  When  Tax  Attaches  to  Legacy. 

It  is  apparent  that  the  decision  in  the  Matter  of 
Seaman  {supra)  is  not  controlling  in  the  general  broad 
view  that  a  transfer  of  personal  property  to  a  legatee 
by  will  takes  place  at  the  moment  of  the  decedent's 
death,  as  the  Appellate  Division,  in  the  Matter  of 
Wolfe,  89  App.  Div.  349,  85  N.  Y.  S.  949;  affd.  on  opin- 
ion below  in  179  N.  Y.  599,  held  that  no  taxable  trans- 
fer to  a  certain  legatee  had  been  made  under  a  dece- 
dent's will  where  the  legatee,  eight  months  after  dece- 
dent's death,  renounced  his  legacy,  as  in  that  case  the 
tax  would  be  imposed  not  upon  the  transfer,  but  upon 
the  attempt  to  transfer. 

The  court,  referring  to  the  opinion  of  Judge  Cullen 
in  the  Matter  of  Gihon,  169  N.  Y.  443,  says:  "  Per- 
sonal property  does  not  pass  directly  from  the  de- 
ceased to  his  legatee,  or  next  of  kin,  but  all  that  such 
legatee  or  next  of  kin  takes  is  what  may  be  coming  to 
him  from  the  estate  on  distribution  after  settlement." 
The  Appellate  Division  further  says:  "  If  no  trans- 
fer is  effected  because  it  turns  out  that  there  is  no 
property  to  transfer,  no  tax  can  be  collected,  and  if  the 
legatee  renounces  the  gift  and  refuses  to  receive  it,  no 
tax  can  be  collected  with  respect  to  him,  because  there 
has  been  no  transfer  to  him.  His  right  to  renounce 
the  privilege  of  accepting  the  donation  is  not  denied 
or  forbidden  by  the  statute,  and  such  right  is  recog- 
nized by  the  authorities.  *  *  *  The  fact  that  the 
tax  is  payable  at  the  death  of  the  testator  controls  the 
question  of  interest,  but  certainly  controls  no  other 
question  germane  to  the  point  now  under  considera- 
tion." 


26  THE   TRANSFER   TAX   LAW. 

15.  Tax  Will  Attach  upon  the  Devolution  of  Title. 

It  matters  not  whether  the  transfer  is  by  grant  or  by 
gift,  so  long  as  it  was  intended  to  take  effect  in  posses- 
sion or  enjoyment  at  or  after  the  death  of  the  grantor, 
the  devolution  of  title  is  subject  to  the  tax.  Matter  of 
Greene,  153  N.  Y.  223. 

16.  Transfer  of  Title,  Time  of. 

The  death  of  the  testator  is  the  time  of  the  transfer 
of  title  to  a  legacy  in  remainder  where  there  is  no  un- 
certainty who  will  take  the  remainder,  although  it  is 
uncertain  when  the  legatee  will  receive  the  legacy. 
Matter  of  Sloane,  154  N.  Y.  109. 

17.  When  Legal  and  Equitable  Title  Vests. 

Where  property  is  bequeathed  to  a  mother  for  life 
with  remainder  to  a  sister,  the  entire  legal  and  equi- 
table estate  vests  in  the  sister  upon  the  death  of  the 
mother,  and  a  residuary  legatee  of  the  sister  takes 
such  remainder  subject  to  the  transfer  tax.  Matter  of 
Zefita,  167  N.  Y.  280. 

18.  Amount  of  the  Tax  — How  Measured. 

The  amount  of  the  tax  is  measured  by  the  sum  or 
value  of  the  property  received  by  the  legatee.  Matter 
of  Hoffman,  143  N.  Y.  327;  Matter  of  Westurn,  152 
N.  Y.  93. 

19.  Meaning  of  Provision  "When  Person  Becomes  Benefici- 

ally Entitled,"  Etc. 

Subdivision  3  of  section  1  of  the  Act  of  1892  (now 
subdivision    4,    section    220),    which    provides    that 


THE  LAW  OF  TAXABLE  TRANSFERS.         27 

"  when  any  such  person  or  corporation  becomes  bene- 
ficially entitled  in  possession  or  expectancy  to  any 
property  or  the  income  thereof  by  any  such  transfer, 
whether  made  before  or  after  the  passage  of  this 
act,"  relates  to  the  instrument  of  transfer;  and  is 
meant  to  cover  a  case  where,  by  the  terms  of  such 
instrument,  no  taxable  estate,  either  in  possession  or 
expectancy,  attached  until  after  the  passage  of  the 
act,  and  not  to  a  case  where  the  transfer  was  prior  to 
the  passage  of  the  act,  although  the  happening  of  the 
event,  or  the  contingency  upon  which  the  estate  actu- 
ally vested  in  possession,  took  place  after  its  passage. 
Tallmadge  v.  Seaman,  9  Misc.  Rep.  303,  30  N.  Y.  S.  304. 
In  the  Matter  of  Seaman,  147  N.  Y.  69,  this  provision 
was  held  not  to  affect  rights  of  succession  which  ac- 
crued before  the  statute  came  into  existence. 

20.  Meaning  of  the  Word  "  Estate  "  Prior  to  Act  of  1892. 

Prior  to  the  Act  of  1892  the  word  "  estate,"  as  used 
in  the  proviso  in  the  Collateral  Inheritance  Tax  Act, 
referred  to  the  interest  of  the  legatee  or  distributee, 
and  not  to  the  whole  estate  of  the  decedent.  Matter  of 
Sterling,  9  Misc.  Rep.  224,  30  N.  Y.  S.  385;  Matter  of 
Cager,  111  N.  Y.  343;  Matter  of  Howe,  112  N.  Y.  100; 
Matter  of  Westurn,  152  N.  Y.  93. 

21.  To  What  the  Word  "  Deed  "  Refers  to  in  this  Act. 

The  word  ' '  deed  ' '  as  used  in  this  act  has  no  refer- 
ence to  conveyance  of  property  by  such  an  instrument 
made  in  the  ordinary  course  of  business  for  a  valuable 
consideration,  but  is  confined  to  conveyances  of  real 
property,  intended  as  gifts,  and  it  is  also  quite  evident 


28  THE   TRANSFER   TAX   LAW. 

that  it  was  intended  to  eliminate  any  technical  distinc- 
tion between  gifts  of  real  property  and  personal  prop- 
erty, and  place  both  claims  in  the  same  category  so  far 
as  the  taxation  of  the  transfers  thereof  under  this  act 
are  concerned.  Matter  of  Birdsell,  22  Misc.  Rep.  180, 
49  N.  Y.  S.  450;  affd.,  43  App.  Div.  624. 

22.  The  Term  "Intestate  Laws." 

u  The  term  '  intestate  laws  '  is  intended  to  cover 
the  statute  of  descent  which  relates  to  the  descent  of 
real  estate,  and  the  statute  of  distribution,  which  pro- 
vides for  the  distribution  of  the  surplus  of  the  per- 
sonal property  of  decedent,  after  the  payment  of  his 
debts  and  legacies  if  he  left  a  will,  and  after  setting 
apart  to  the  widow  and  minor  children  the  exemptions 
specified  in  section  2713."  Matter  of  Page,  39  Misc. 
Rep.  220,  221,  79  N.  Y.  S.  382. 

23.  Intestate  Law  —  Distribution  Among  Collaterals. 

Prior  to  1898,  subdivision  12  of  section  2732  of  the 
Code  of  Civil  Procedure  read:  "  No  representation 
shall  be  admitted  among  collaterals  after  brothers '  and 
sisters'  children." 

In  1898  said  subdivision  was  amended  to  read  as 
follows :  ' i  Representation  shall  be  admitted  among 
collaterals  in  the  same  manner  as  allowed  by  law  in 
reference  to  real  estate. ' ' 

Where  an  intestate  is  survived  by  nephews  and 
nieces  and  by  grandnephews  who  are  children  of  a  de- 
ceased nephew  and  niece,  all  of  such  persons  having 
sprung  from  the  intestate's  deceased  brother,  the 
grandnephews  are  entitled  to  receive  their  parent's 


THE  LAW   OF   TAXABLE   TRANSFERS.  29 

share  of  the  personal  estate.  Matter  of  Ebbets,  43 
Misc.  Rep.  575,  89  N.  Y.  S.  544;  Matter  of  McGovem, 
N.  Y.  Law  Journal,  March  26,  1903,  distinguishing 
Matter  of  Davenport,  172  N.  Y.  454;  Matter  of  Eadley, 
43  Misc.  Rep.  579,  89  N.  Y.  S.  545;  Matter  of  Kearney, 
N.  Y.  Law  Journal,  May  4,  1905.  Subdivision  12  was 
further  amended  by  chapter  539  of  the  Laws  of  1905, 
in  effect  May  18th  of  that  year,  so  as  to  read : 

"  No  representation  shall  be  admitted  among  col- 
laterals after  brothers'  and  sisters'  descendants. 

1 4  This  act  shall  not  apply  to  an  estate  of  a  decedent 
who  shall  have  died  prior  to  the  time  this  act  shall  take 
effect." 

24.  Equitable  Conversion  —  Could  Not  be  Invoked. 

Prior  to  the  enactment  of  chapter  41  of  the  Laws  of 
1903  the  real  property  passing  to  those  in  the  1-per 
cent,  class  was  not  taxable,  and  it  was  held  that  the 
character  of  the  property,  as  it  existed  at  the  time  of 
the  decedent's  death,  determined  its  liability  to  taxa- 
tion, and  that  the  doctrine  of  equitable  conversion 
would  not  be  invoked  to  make  real  property  passing  to 
the  1-per  cent,  class  subject  to  tax.  Matter  of  Swift, 
137  N.  Y.  77;  Matter  of  Sutton,  3  App.  Div.  208,  38 
N.  Y.  S.  277;  affd.,  149  N.  Y.  618;  Matter  of  Offer-man, 
25  App.  Div.  94,  48  N.  Y.  S.  993 ;  Matter  of  Livingston, 
1  App.  Div.  568,  37  N.  Y.  S.  8;  Matter  of  Cobb,  14  Misc. 
Rep.  409,  36  N.  Y.  S.  448. 

25.  Where  Legatee  Dies  Before  Conversion  Takes  Place. 

In  the  Matter  of  Mills,  86  App.  Div.  555,  67  N.  Y.  S. 
956,  84  N.  Y.  S.  1135;  affd.,  177  N.  Y.  562,  a  decedent's 


30  THE    TRANSFER   TAX    LAW. 

will  directed  that  his  real  estate  be  converted  into  per- 
sonalty, and  his  daughter  was  entitled  to  a  share  of  the 
proceeds  of  the  realty.     The  daughter  died  before  an 
actual  sale  of  the  real  estate,  leaving  a  will,  by  which 
her  interest  in  her  father's  estate  passed  to  her  hus- 
band.    Held,  that  the  interest  in  the  proceeds  of  the 
real  estate  to  which  the  daughter  (Mrs.  Mills)  was  en- 
titled, and  which  passed  under  said  daughter's  will 
to  her  husband,  should,  for  the  purpose  of  the  transfer 
tax,  upon  the  transfers  from  the  daughter  to  her  hus- 
band, be  treated  as  personal  property  and  not  as 
realty.      That  Mrs.  Mills,  the  daughter,  did  not  die 
possessed  of  the  title  to  the  real  estate ;  she  died  pos- 
sessed of  a  right  to  a  distributive  share  in  the  pro- 
ceeds of  real  estate  which  her  father's  executor  was 
directed  to  sell.     Her  legatee  could  not,  in  law,  have 
given  a  deed  of  it,  nor  have  reconverted  it  without 
the  interposition  of  equitable  rules.     It  was  subject 
to  the  payment  of  debts,  expenses  of  administration, 
general  legacies,  executors  commissions,  and  the  ex- 
penses primarily  payable  out  of  the  personalty. 

26.  Renunciation  of  Legacy  —  Tax  is  Then  Upon  the  Ultimate 
Devolution. 

Section  242  (post)  defines  a  transfer  as  including 
the  passing  of  property,  or  an  interest  therein,  in  pos- 
session or  enjoyment,  present  or  future,  by  inherit- 
ance, descent,  devise,  bequest,  grant,  deed,  bargain, 
sale,  or  gift,  and  under  the  rule  of  strict  construction 
the  transfer  tax  is  not  laid  on  the  property  trans- 
ferred, nor  on  the  estate  of  the  legatee,  but  merely  on 
the  transfer  itself;  and,  with  respect  to  legatees  who 


THE  LAW  OF  TAXABLE  TRANSFERS.  31 

renounce  their  legacies,  no  tax  can  be  collected,  but 
the  succession  thereupon  becomes  taxable  in  accord- 
ance with  the  ultimate  devolution  of  the  property. 

In  the  Matter  of  Wolfe,  89  App.  Div.  349,  85  N.  Y.  S. 
949 ;  affd.  on  opinion  below,  in  179  N.  Y.  599,  the  tes- 
tator by  his  will  bequeathed  $20,000  absolutely  to  his 
executors,  who  were  unrelated  to  him.  The  residue 
of  his  estate  he  gave  to  his  executors  in  trust  for  his 
surviving  children.  The  executors,  some  eight  months 
afterward,  by  instruments  in  writing,  renounced  and 
released  the  said  bequest,  but  did  not  name  any  one 
in  whose  favor  such  renunciation  was  made.  There 
was  no  claim  in  this  case  that  the  executors,  by  their 
renunciation,  were  attempting  to  evade  the  payment 
of  the  transfer  tax  at  the  higher  rate. 

The  surrogate  of  Orange  county  assessed  a  transfer 
tax  on  this  bequest  of  $20,000  to  the  executors  at  5  per 
cent.,  such  bequest  being  in  addition  to  their  commis- 
sions, upon  the  ground  that  the  legacy  to  the  execu- 
tors became  subject  to  tax  immediately  upon  the  death 
of  the  testator,  and  that  they  could  not  defeat  the  right 
of  the  State  to  that  tax  or  any  part  of  it,  by  any  subse- 
quent act  of  theirs.  Citing  Matter  of  Seaman,  147 
N.  Y.  at  p.  69;  Matter  of  Greene,  153  N.  Y.  at  p.  223. 

The  Appellate  Division,  in  reversing  the  order  of 
the  surrogate,  held  that  the  force  of  this  view  might 
be  convincing  if  the  tax  was  upon  the  legacy,  but  that 
it  was  greatly  weakened  by  the  consideration  that  the 
tax  is  not  imposed  upon  the  property  at  all,  although 
payable  out  of  it,  but  is  imposed  upon  the  succession 
to,  or  transfer  of,  the  property,  and  that  the  word 
"  transfer  "  as  denned  in  the  statute  means  the  pass- 


32  THE    TRANSFER    TAX    LAW. 

ing  of  property  in  possession  or  enjoyment,  and  until 
there  was  such  a  passing  of  property  in  possession  or 
enjoyment  there  was  no  transfer,  as  otherwise  the  tax 
would  be  imposed,  not  upon  the  transfer,  but  upon  the 
attempt  to  transfer.  This  necessarily  implies  that 
there  must  be  some  act  of  volition,  upon  the  part  of 
the  legatee,  equal  at  least  to  an  acceptance  of  the 
legacy  before  the  State  is  entitled  to  the  tax. 

The  court  says,  however,  that  a  different  question 
would  be  presented  by  a  transfer  operating  under  the 
laws  of  inheritance  or  descent,  as  in  such  case  the 
transfer  is  effected  by  operation  of  law,  and  calls  for 
no  act  of  volition  on  the  part  of  the  heir  or  next  of  kin. 


CHAPTER  III. 


Taxable  Transfers  —  Property  and  Interests  Tax- 
able. 


27.  Taxable  transfers. 

28.  The  word   "  property "   is   not 

limited  to  the  definition 
thereof  under  the  General 
Tax  Law. 

29.  "  Personal     property "    as    de- 

fined by  the  Statutory  Con- 
struction Law. 

30.  What  shall  be  deemed  assets  of 

the  estate. 

31.  When    person    becomes    "  bene- 

ficially entitled,"  etc. 

32.  Money  deposited  in  bank  to  pay 

debt  owing  to  a  nonresident 
decedent. 

33.  Personal  property  wherever  sit- 

uated is  taxable. 

34.  When  administered  upon  with- 

out the  State. 

35.  Residence     of    beneficiary    not 

material. 

36.  Note  of  legatee,  included  in  be- 

quest of  residuary  estate. 

37.  Judgment  in  favor  of  decedent 

against  heir  or  legatee. 

38.  Land  devised  subject  to  a  mort- 

gage. 

39.  Debts  due  from  a  legatee. 

40.  Interest  of  decedent  in  surplus 

fund  in  partition  suit. 

41.  Bequest  for  masses. 

42.  Good-will  of  business. 

43.  Legatee  dying  before  receiving 

his  legacy;  when  same  is 
taxable. 

44.  Annuity    to    an    executor    and 

trustee  is  taxable. 


45.  Insurance  policy  payable  to  de- 

cedent's executors,  etc. 

46.  Shares  of  stock  in   joint-stock 

association. 

47.  Stocks  of  foreign  corporations. 

48.  A  bequest  to  the  United  States 

is  taxable. 

49.  Agreement     between     partners 

does  not  create  joint  ten- 
ancy. 

50.  Legacy  in  payment  of  debts  for 

services. 

51.  Legacy    to    widow    in    lieu    of 

dower  is  taxable. 

52.  Seat    or    membership    in    New 

York  Stock  Exchange. 

53.  United   States   bonds   prior   to 

Act  of  1892  and  after  March 
21,  1898. 

54.  Stock  pledged  as  collateral  to 

loan ;  redeemed  is  taxable. 

55.  Legacy  absolute  in  terms;   al- 

though shown  by  extrinsic 
proof  to  be  imposed  with  a 
trust. 

56.  When    a    taxable   bequest   will 

be  deemed  created;  law 
phrases  unnecessary. 

57.  Debts  owing  by  resident  to  non- 

resident decedent. 

58.  Deposit  with  trust  company  al- 

though certificates  therefor 
are  held  without  this  State. 

59.  Deposits  with  banker  to  protect 

a  margin. 

60.  Profits,  when  taxable. 

61.  Leasehold  interests  in  land. 


34  THE    LAW    OF    TAXABLE    TRANSFERS. 


67.  Id.;  "mother  or  daughter." 

68.  Promissory    note     payable     to 

husband  and  wife. 

69.  Bond   and   mortgage;    held   by 

husband  and  wife  jointly. 

70.  Taxability  of  an  estate;   what 

law  determines. 

71.  Legacy  in  lieu  of  dower  is  not 

a  debt  of  the  estate. 


62.  Money    loaned    is    not    an    ad- 

vancement. 

63.  Fund  held  for  grantor's  life,  re- 

serving power  to  dispose  of 
same  by  will. 

64.  Savings     bank     deposits;      in 

trust,  etc. 

65.  Id.;    joint    accounts;    husband 

and  wife. 

66.  Id. ;  where  "  either  or  the  sur- 

vivor may  draw." 

Reference  to  other  taxable  transfers,  including  the  property  of  non- 
residents, see  Chapters  V,  VI,  and  VII. 

27.  Taxable  Transfers. 

[§  220,  Tax  Law.]  A  tax  shall  be  and  is  hereby  imposed 
upon  the  transfer  of  any  property,  real1  or  personal,2  of  the 
value  of  five  hundred  dollars  or  over,  or  of  any  interest 
therein  or  income  therefrom,  in  trust  or  otherwise,3  to  per- 
sons or  corporations  not  exempt  by  law  from  taxation  on  real 
or  personal  property,  in  the  following  cases : 

1.  When  the  transfer  is  by  will  or  by  the  intestate  laws  of 
this  state  from  any  person  dying  seized  or  possessed  of  the 
property  while  a  resident  of  the  state. 

2.  When  the  transfer  is  by  will  or  intestate  law,  of  prop- 
erty within  the  state,  and  the  decedent  was  a  nonresident4  of 
the  state  at  the  time  of  his  death. 

3.  When  the  transfer  is  of  property  made  by  a  resident  or 
by  a  nonresident  when  such  nonresident's  property  is  within 
this  state,  by  deed,  grant,  bargain,5  sale  or  gift  made  in  con- 
templation of  the  death6  of  the  grantor,  vendor  or  donor,  or 

1.  Chap.  41,  Laws  1903  —  in  effect  March  16  of  that  year. —  First 
taxes  transfer  of  real  property  to  1-per  cent,  class. 

2.  Chap.  215,  Laws  1891  — in  effect  April  20  of  that  year.— First 
taxes  transfers  of  personal  property  to  1-per  cent,  class. 

3.  Chap.  713,  Laws  1887  —  in  effect  June  25  of  that  year. —  Included 
property  transferred  "  in  trust  or  otherwise." 

4.  Chap.  713,  Laws  1887  —  in  effect  June  25  of  that  year. —  First 
law  taxing  property  in  this  State  of  nonresident  decedents. 

5.  Chap.  399,  Laws  1892  —  in  effect  May  1  of  that  year. —  Added  the 
word  "bargain"  to  subdivision  3  of  section  1   (now  §  220). 

6.  Chap.  215,  Laws  1891  — in  effect  April  20  of  that  year.— First 
taxes  transfer  "  made  in  contemplation  of  death." 


PROPERTY  AND  INTERESTS  TAXABLE.         35 

intended  to  take  effect  in  possession  or  enjoyment  at  or  after 
such  death.7 

4.  When  any  such  person  or  corporation  becomes  bene- 
ficially entitled,  in  possession  or  expectancy,  to  any  property 
or  the  income  thereof  by  any  such  transfer,  whether  made 
before  or  after  the  passage  of  this  act.8 

5.  Whenever  any  person  or  corporation  shall  exercise  a 
power  of  appointment  derived  from  any  disposition  of 
property  made  either  before  or  after  the  passage  of  this  act, 
such  appointment  when  made  shall  be  deemed  a  transfer 
taxable  under  the  provisions  of  this  act  in  the  same  manner 
as  though  the  property  to  which  such  appointment  relates  be- 
longed absolutely  to  the  donee  of  such  power  and  had  been 
bequeathed  or  devised  by  such  donee  by  will ;  and  whenever 
any  person  or  corporation  possessing  such  a  power  of  appoint- 
ment so  derived  shall  omit  or  fail  to  exercise  the  same  within 
the  time  provided  therefor,  in  wdiole  or  in  part,  a  transfer 
taxable  under  the  provisions  of  this  act  shall  be  deemed  to 
take  place  to  the  extent  of  such  omission  or  failure,  in  the 
same  manner  as  though  the  persons  or  corporations  thereby 
becoming  entitled  to  the  possession  or  enjoyment  of  the  prop- 
erty to  which  such  power  related  had  succeeded  thereto  by  a 
will  of  the  donee  of  the  power  failing  to  exercise  such  power, 
taking  effect  at  the  time  of  such  omission  or  failure.9 

6.  The  tax  imposed  hereby  shall  be  at  the  rate  of  five  p6r 
centum  upon  the  clear  market  value  of  such  property,  except 
as  otherwise  prescribed  in  the  next  section.10 

7.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year. —  Taxes 
transfers  made  by  deed,  grant,  sale,  or  gift  "  to  take  effect  at  or  after 
death  "  of  donor,  etc. 

8.  Chr.p.  399,  Laws  1892  —  in  effect  May  1  of  that  year.— Section  1 
first  contained  this  provision. 

9.  Chap.  284,  Laws  1897  —  in  effect  April  16  of  that  year.— Added 
subdivision  5  to  section  220,  relative  to  transfers  upon  exercise  of  power 
of  appointment. 

10.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year. —  Sub- 
stantially enacted  this  provision  and  it  has  since  been  retained  in 
each  amendment  or  re-enactment  of  the  statute  effecting  taxable  trans- 
fers. 


36  THE    LAW    OF    TAXABLE    TKANSFERS. 

28.  The  Word  "  Property  "  is  Not  Limited  to  the  Definition 
Thereof  Under  the  General  Tax  Law. 

Subdivisions  3  and  5  of  section  2  of  the  General  Tax 
Law  of  the  State  of  New  York  (chap.  908,  L.  1896)  de- 
fines what  shall  be  included  in  the  terms  "  land," 
"  real  estate,"  and  "  real  property,"  also  the  terms 
"  personal  estate  "  and  "  personal  property." 

The  courts  have  held,  however,  that  these  definitions 
did  not  limit  the  property,  the  transfer  of  which  is  sub- 
ject to  taxation  under  the  law  taxing  taxable  transfers. 
In  the  Matter  of  Knoedler,  140  N.  Y.  377,  the  court 
says :  ' '  The  argument  is  made  that  it  is  only  prop- 
erty which  is  liable  to  taxation  under  the  General  Tax 
Law  of  the  State  which  can  be  taxed  under  the  act 
relating  to  taxable  transfers,  *  *  *.  The  Taxable 
Transfer  Law  has  no  reference  or  relation  to  the  gen- 
eral law.  The  two  acts  are  not  in  pari  materia. 
While  the  object  of  both  is  to  raise  revenue  for  the 
support  of  the  government,  they  have  nothing  else 
in  common.  Nearly  sixty  years  intervened  between 
the  passage  of  the  earlier  and  the  later  statute,  and 
the  latter  was  enacted  under  different  conditions  from 
the  former.  It  taxes  the  right  of  succession  to  prop- 
erty, and  measures  the  tax  in  the  method  specifically 
prescribed.  All  property  having  an  appraisable 
value  must  be  considered,  whether  it  is  such  as  might 
be  taxed  under  the  general  law  or  not.  Many  kinds 
of  property  might  be  enumerated  which  are  not  assess- 
able under  the  general  law,  but  which  are  appraisable 
under  the  Collateral  Inheritance  Act." 


PROPERTY  AND  INTERESTS  TAXABLE.         37 

29.  "  Personal  Property  "  as  Defined  by  the  Statutory  Con- 

struction Law. 

As  defined  by  the  Statutory  Construction  Law  (L. 
1892,  chap.  677,  §  4),  the  term  "  personal  property  ' 
includes  "  chattels,  money,  things  in  action,  and  all 
written  instruments  themselves  as  distinguished  from 
the  rights  or  interests  to  which  they  relate,  by  which 
any  right,  interest,  lien  or  incumbrance  in,  to  or  upon 
property,  or  any  debt  or  financial  obligation  is  created, 
acknowledged,  evidenced,  transferred,  discharged  or 
defeated,  wholly  or  in  part,  and  everything,  except  real 
property,  which  may  be  the  subject  of  ownership." 
Matter  of  Jones,  172  N.  Y.  575,  585 ;  Matter  of  Dun, 
40  Misc.  Rep.  509,  82  N.  Y.  S.  802. 

30.  What  Shall  be  Deemed  Assets  of  the  Estate. 

11  The  statute  has  declared  what  shall  be  deemed 
assets  of  the  estate  of  a  deceased  person  and  subject 
to  distribution  by  his  executors  or  administrators  (4 
R.  S.,  8th  ed.,  p.  2556,  §  6),  and  includes  among  them 
choses  in  action  and  '  every  other  species  of  personal 
property  and  effects.'  "  Matter  of  Knoedler,  140 
N.  Y.  377-379. 

The  court  in  this  case  said,  in  answer  to  the  con- 
tention of  the  appellants  that  life  insurance  policies 
were  not  property  of  which  the  testator  dies  seized 
and  possessed  at  the  time  of  his  death :  ' '  But  it  must 
be  admitted  that  they  were  obligations  to  pay  money  at 
a  future  date,  and  every  instrument  duly  executed  and 
having  a  lawful  consideration,  which  secures  to  the 
holder  the  payment  of  money  at  a  specified  time,  con- 
fers upon  him  a  right  of  property." 


38  THE    LAW    OF    TAXABLE    TRANSFERS. 

31 .  When  Person  Becomes  "  Beneficially  Entitled,"  Etc. 
Under  Transfer  Tax  Law  (L.  1896,  chap.  908,  as 

amended  by  chap.  284,  L.  1897),  section  220,  subdi- 
vision 4,  providing  that  the  transfers  shall  be  taxable 
when  any  person  becomes  beneficially  entitled  in  pos- 
session or  expectancy  to  any  property  or  the  income 
thereof  —  property  which  passes  under  a  father 's  will 
to  his  son,  who  dies  before  a  settlement  of  the  father's 
estate,  which  property  is  afterward  delivered  to  the 
son's  executor  —  is,  when  so  delivered,  subject  to  a 
transfer  tax.  Matter  of  Clinch,  44  Misc.  Rep.  190,  89 
N.  Y.  S.  802;  affd.,  99  App.  Div.  298,  90  N.  Y.  S.  923; 
affd.,  180  N.  Y.  300. 

32.  Money  Deposited  in  Bank  to  Pay  Debt  Owing  to  a  Non- 

resident Decedent. 

Money  due  a  nonresident,  who,  owing  to  serious  ill- 
ness was  unable  to  transact  business,  was  given  to  his 
secretary  in  payment  of  the  debt,  and  by  him  deposited 
in  a  bank  in  New  York  city  as  a  special  account  in  the 
creditor's  name,  where  it  remained  until  after  the 
creditor's  death.  Held,  that  the  money  was  subject  to 
the  creditor's  order  at  the  time  of  his  death,  and  the 
creditor  having  died  without  affirming  or  disaffirming 
the  transaction,  and  his  estate  having  received  the 
special  deposit  as  money  due  from  the  bank,  the  law 
would  so  treat  it,  and  hence  it  was  subject  to  a  transfer 
tax  in  this  State.  Matter  of  Daly,  100  App.  Div.  373, 
91  N.  Y.  S.  858;  affd.,  182  N.  Y.        ,  no  opinion. 

33.  Personal  Property  Wherever  Situated  is  Taxable. 

The  personal  property  of  a  resident  decedent, 
whether  situated  within  or  without  this  State,  is  tax- 


PROPERTY  AND  INTERESTS  TAXABLE.  39 

able.  Matter  of  Swift,  137  N.  Y.  77;  Matter  of  Com- 
ing, 3  Misc.  Rep.  160,  23  N.  Y.  S.  285. 

34.  When  Administered  Upon  Without  the  State. 
Personal  property  of  a  resident  decedent  located 

without  the  State  is  taxable,  although  it  was  admin- 
istered upon  by  a  foreign  executor,  and  the  property 
passed  to  foreign  heirs  or  next  of  kin.  Matter  of  Ding- 
man,  66  App.  Div.  228,  72  N.  Y.  S.  694. 

35.  Residence  of  Beneficiary  Not  Material. 

Whether  the  beneficiaries  reside  in  this  State  or 
elsewhere,  it  is  not  important  as  affecting  the  taxa- 
bility of  the  property  transferred.  Matter  of  Greene, 
153  N.  Y.  223. 

36.  Note  of  Legatee,  Included  in  Bequest  of  Residuary  Estate. 

Where  a  bequest  of  the  residuary  estate  includes  a 
note  made  by  the  legatee,  the  amount  thereof  is  tax- 
able.   Matter  of  Tuigg,  2  Con.  633.    (Decision,  Act  of 

1887.) 

37.  Judgment  in  Favor  of  Decedent  Against  Heir  or  Legatee. 
A  judgment  against  an  heir  or  legatee  in  favor  of 

the  decedent  should  be  appraised.  Matter  of  Smith,  14 
Misc.  Rep.  169,  35  N.  Y.  S.  701. 

38.  Land  Devised  Subject  to  a  Mortgage. 

A  devisee  of  land  which  is  subject  to  a  mortgage 
takes  it  cum  onere,  and  the  equity  therein  is  only  liable 
to  taxation.  Matter  of  Kene,  8  Misc.  Rep.  102,  29 
N.  Y.  S.  1078. 


40  THE    LAW    OF    TAXABLE    TRANSFERS. 

39.  Debts  Due  from  a  Legatee. 

Where  testator  gives  his  estate  for  life  to  his  wife, 
and  at  her  death  directs  that  the  whole  thereof,  includ- 
ing the  indebtedness  of  two  sons  for  moneys  thereto- 
fore lent  and  advanced  to  them,  shall  be  divided 
among  his  children,  the  appraiser  should  include  in  his 
valuation  of  the  estate  the  indebtedness  due  from  such 
sons,  although  they  are  two  of  the  seven  residuary 
legatees.  Matter  of  Bartlett,  4  Misc.  Rep.  380,  25  N. 
Y.  S.  990. 

40.  Interest  of  Decedent  in  Surplus  Fund  in  Partition  Suit. 
The  deceased,  an  infant  about  sixteen  years  old,  left 

her  surviving  a  father,  brother,  and  sister,  and  owned 
at  the  time  of  her  death  an  interest  in  a  fund  deposited 
to  the  credit  of  a  partition  action  to  which  she  was  a 
party.  Held,  that  her  interest  in  such  fund,  although 
the  proceeds  of  the  sale  of  land,  was  not  real  property, 
and  therefore  was  not  exempt  from  taxation  under 
the  Act  of  1892.  Matter  of  Stiger,  7  Misc.  Rep.  268,  28 
N.  Y.  S.  163. 

41.  Bequest  for  Masses. 

It  was  held  in  the  Matter  of  Black,  1  Con.  477,  5 
N.  Y.  S.  452,  that  a  bequest  to  be  used  for  saying 
masses  was  taxable,  unless  it  was  included  in  the 
funeral  expenses,  but  the  practice  has  been  to  consider 
such  a  bequest  as  a  part  of  the  funeral  or  testamentary 
expenses,  especially  so  where  the  testator  makes  that 
direction  by  his  will,  or  the  amount  given  for  that  pur- 
pose is  reasonable,  and  such  amounts  are  accordingly 
deducted  from  the  gross  estate  before  the  tax  is  ascer- 
tained. 


PROPERTY  AND  INTERESTS  TAXABLE.  41 

42.  Good- Will  of  Business. 

The  good-will  of  a  newspaper  conducted  by  a  joint- 
stock  association  is  property  which  passes  under  the 
will  of  the  deceased  member,  and  the  value  thereof 
should  be  included  in  determining  the  amount  of  his 
estate,  subject  to  such  transfer  tax.  Matter  of  Jones, 
69  App.  Div.  237,  74  N.  Y.  S.  702;  revd.  on  another 
point,  172  N.  Y.  575. 

The  Court  of  Appeals  having  held  that  the  defini- 
tion applicable  to  "  property  "  as  defined  in  section 
242  was  declared  to  "  include  all  property  or  interest 
therein,"  and  the  Statutory  Construction  Law  (L. 
1892,  chap.  677,  §  4)  having  defined  "  personal  prop- 
erty "  as  "  including  *  *  *  everything,  except 
real  property,  which  may  be  the  subject  of  owner- 
ship," the  good-will  of  the  business  of  a  firm  is  tax- 
able, where  the  decedent  was  the  sole  owner  of  the 
firm  and  his  will  transferred  the  business.  Matter  of 
Dun,  40  Misc.  Eep.  509,  82  N.  Y.  S.  802. 

The  firm  name  of  a  partnership  under  which  it  has 
done  business  for  many  years  does  not  inure  to  the 
surviving  partner,  but  is  a  part  of  the  good-will  of  the 
firm,  and  subject  to  sale  in  the  same  way  as  other  firm 
property.    Slater  v.  Slater,  175  N.  Y.  143. 

43.  Legatee  Dying  Before  Receiving  His  legacy — When  Same 

is  Taxable. 

Where  a  person  is  entitled  to  a  legacy  or  distribu- 
tive share  in  the  estate  of  a  decedent,  but  dies  before 
the  same  has  been  paid  to  him,  said  legacy  or  share 
when  received  by  the  executors  of  the  legatee's  estate 


42  THE    LAW    OF    TAXABLE    TRANSFERS. 

is  subject  to  appraisal  and  taxation  in  accordance  with 
the  disposition  made  thereof  by  the  will  of  the  de- 
ceased legatee  or,  in  case  of  intestacy,  by  the  statute. 
Matter  of  Clinch,  180  N.  Y.  300. 

44.  Annuity  to  an  Executor  and  Trustee  is  Taxable. 
Testator  by  his  will  provided  that  his  executor  and 

trustee  should  be  paid  from  his  estate  the  sum  of 
$1,500  annually,  together  with  the  commissions  al- 
lowed by  law,  as  long  as  he  shall  act  as  such  executor 
and  trustee,  the  same  to  be  received  by  him  in  full 
compensation  for  any  and  all  services,  legal  or  other- 
wise, which  he  should  render  decedent's  estate.  Held, 
that  the  annuity  so  bequeathed  was  subject  to  a  trans- 
fer tax  under  the  provisions  of  section  227  of  the  Tax 
Law  (now  §  226) ;  that  the  fact  that  the  annuity  may 
be  presumed  to  have  been  given  in  payment  for  serv- 
ices to  be  rendered  does  not  change  the  law  upon  this 
question,  as  the  annuity,  whatever  its  purpose,  was  a 
transfer  by  the  will  of  the  decedent.  Matter  of  Ruber, 
86  App.  Div.  458,  83  N.  Y.  S.  769,  citing  Matter  of 
Gould,  156  N.  Y.  423. 

45.  Insurance  Policy  Payable  to  Decedent's  Executors,  Etc. 

A  policy  of  insurance  upon  the  life  of  a  decedent 
held  by  him  at  the  time  of  his  death,  payable  to  his 
executors,  administrators  and  assigns,  or  to  his  per- 
sonal representatives,  is  property,  owned  by  him  at 
his  death  within  the  meaning  of  the  Collateral  In- 
heritance Act  of  1887,  and  so,  under  that  act,  is  sub- 
ject to  appraisal  and  taxation.  Matter  of  Knoedler, 
140  N.  Y.  377. 


PROPERTY  AND  INTERESTS  TAXABLE.         43 

46.  Shares  of  Stock  in  Joint-Stock  Association. 

The  shares  of  a  joint-stock  association  constitute 
personal  property  and  are  taxable  as  such,  irre- 
spective of  the  character  of  the  property  represented 
thereby,  whether  real  or  personal,  and  the  interest  of  a 
deceased  shareholder  in  the  realty  of  a  joint-stock 
association  is  personal  property,  and  under  chapter 
215,  Laws  of  1891,  a  bequest  thereof  is  subject  to  the 
transfer  tax.    Matter  of  Jones,  172  N.  Y.  575. 

47.  Stocks  of  Foreign  Corporations. 

Stocks  of  foreign  corporations  held  by  an  executor 
as  such  are  to  be  regarded  as  part  of  the  estate  and  so 
the  right  to  succession  thereto  is  subject  to  payment 
of  the  tax  imposed  by  said  act.  Matter  of  Merriam, 
141  N.  Y.  479-485. 

48.  A  Bequest  to  the  United  States  is  Taxable. 

The  United  States  is  to  be  regarded  as  a  body  politic 
and  corporate,  and  so  far  as  this  State  is  concerned, 
it  is  a  foreign,  not  a  domestic,  corporation.  (Code  Civ. 
Proc,  §  3343,  subd.  18.)  Under  section  1,  chapter  399, 
Laws  of  1892,  which  imposes  a  tax  upon  the  transfer 
by  will  or  intestate  law  of  any  property  of  the  value 
of  $500  "  to  persons  or  corporations  not  exempt  by 
law  from  taxation,"  a  bequest  to  the  United  States  is 
subject  to  the  tax  so  imposed.  Matter  of  Merriam, 
141  N.  Y.  479;  Matter  of  Cullom,  145  N.  Y.  593. 

49.  Agreement    Between    Partners    Boes    Not    Create    Joint 

Tenancy. 

An  agreement  between  partners  that  they  were 
"  jointly  "  interested  in  all  real  and  personal  prop- 


44  THE    LAW    OF    TAXABLE    TRANSFERS. 

erty  heretofore  held  or  now  or  hereafter  held  in  the 
joint  name  or  individual  name  of  either  of  them,  places 
the  property  referred  to  in  the  position  simply  of 
partnership  property,  and  does  not  create  a  strict 
joint  tenancy  therein  under  which,  on  the  death  of  one 
of  the  partners,  the  property  would  pass  to  the  sur- 
vivor, and  the  surrogate  was  right  in  refusing  to 
allow  the  sum  of  $250,000,  or  any  amount,  for  the 
alleged  claim  of  the  surviving  partner  to  the  whole 
assets  of  the  firm.  Matter  of  Wormser,  51  App.  Div. 
441-443,  64  N.  Y.  S.  897. 

50.  legacy  in  Payment  of  Debt  for  Services. 

The  transfer  by  will,  subjected  to  taxation  by  the 
Act  of  1892,  is  not  limited  to  property  gratuitously 
given  by  will,  but  extends  to  a  testamentary  transfer 
in  payment  of  a  debt.  It  matters  not  what  the  motive 
of  a  transfer  by  will  may  be,  whether  to  pay  a  debt, 
discharge  some  moral  obligation,  or  to  benefit  a  rela- 
tive. If  the  devise  or  bequest  is  accepted  by  the  bene- 
ficiary, the  transfer  is  made  by  will,  within  the  mean- 
ing of  the  Transfer  Tax  Act.  Matter  of  Gould,  156 
N.  Y.  423;  Matter  of  Doty,  7  Misc.  Rep.  193,  27  N.  Y.  S. 
653. 

51.  Legacy  to  the  Widow  "  in  Lieu  of  Dower  "  is  Taxable. 

A  legacy  given  the  testator's  widow  in  lieu  of  dower, 
if  accepted  by  her,  is  taxable  for  the  reason  that  there 
has  then  been  a  transfer  to  her  by  will.  Matter  of 
Riemann,  42  Misc.  Rep.  648,  87  N.  Y.  S.  731,  following 
Matter  of  Gould,  156  N.  Y.  423. 


PROPERTY  AND  INTERESTS  TAXABLE.  45 

52.  Seat  or  Membership  in  New  York  Stock  Exchange. 

A  seat  or  membership  in  the  New  York  Stock  Ex- 
change of  a  nonresident  of  the  State  of  New  York 
upon  the  death  of  such  nonresident  is  subject  to  a 
transfer  tax  in  this  State.  Matter  of  Curtis,  31  Misc. 
Rep.  83;  Matter  of  Glendinning ,  68  App.  Div.  125,  74 
N.  Y.  S.  190;  affd.,  171  N.  Y.  684.  To  the  same  effect 
Matter  of  Hellman,  174  N.  Y.  254;  revg.  77  App.  Div. 
355,  79  N.  Y.  S.  201.  The  later  decision  was  subse- 
quent to  revision  of  the  Tax  Law,  and  the  consolida- 
tion of  the  previous  legislation  into  a  single  statute  — 
chapter  908,  Laws  of  1896. 

53.  United   States  Bonds  Prior  to  Act  of  1892,   and  After 

March  21,  1898. 

It  was  established  prior  to  the  Act  of  1892  that 
transfers  of  United  States  bonds  were  subject  to  the 
tax.  Matter  of  Howard,  5  Dem.  483;  Matter  of  Car- 
ver, 4  Misc.  Rep.  592,  25  N.  Y.  S.  991;  Matter  of 
Tuigg's  Estate,  15  N.  Y.  S.  548. 

A  transfer  of  United  States  bonds  which  took  place 
after  March  21,  1898,  the  date  on  which  chapter  88, 
Laws  of  1898,  took  effect,  is  taxable,  although  the 
bonds  were  issued  under  an  act  which  provided  that 
they  should  be  exempt  from  taxation  by  the  United 
States  and  "  from  taxation  in  any  form  by  or  under 
State,  municipal,  or  local  authority."  Matter  of 
Plximmer,  30  Misc.  Rep.  19,  62  N.  Y.  S.  1024;  affd.,  47 
App.  Div.  625,  62  N.  Y.  S.  1145,  161  N.  Y.  631;  Plwm- 
mer  v.  Coler,  178  U.  S.   115. 


46  THE    LAW    OF    TAXABLE    TRANSFERS. 

54.  Stock  Pledged  as  Collateral  to  Loan  —  Redeemed  is  Tax- 

able. 

A  pledge  redeemed  by  the  pledgor's  executor  is  tax- 
able against  the  pledgor's  estate. 

Where  the  executor  of  a  resident  decedent  who 
pledged  her  stock  in  a  domestic  bank  as  collateral  to  a 
loan  made  to  her  by  said  bank,  pays  off  the  loan  and 
redeems  the  stock,  it  becomes  presently  taxable  as  a 
part  of  her  estate  because  the  pledgee  no  longer  has 
any  interest  in  it  which  requires  protection.  Matter 
of  Hurcomb,  36  Misc.  Rep.  755,  74  N.  Y.  S.  475. 

55.  legacy   Absolute   in  Terms  —  Although   Shown   by   Ex- 

trinsic Proof  to  be  Imposed  With  a  Trust. 

An  executor  who,  under  the  will,  takes  a  third  of  the 
residuary  estate  absolutely  unincumbered  by  any 
trust  imposed  by  the  will  itself,  is  not  relieved  from 
payment  of  the  inheritance  tax  imposed  by  the  Col- 
lateral Inheritance  Tax  Law  (chapter  713,  Laws  of 
1887)  by  the  fact  that  in  an  action  brought  io  obtain  a 
judicial  construction  of  the  will,  it  is  held  as  a  result 
of  extrinsic  evidence  that  he  took  the  legacy  imposed 
with  a  trust  in  favor  of  the  testatrix's  brother.  Mat- 
ter of  Edson,  38  App.  Div.  19,  56  N.  Y.  S.  409;  aftU, 
159  N.  Y.  568. 

56.  When  a  Taxable  Bequest  Will  be  Deemed  Created  —  Law 

Phrases  Unnecessary. 

To  constitute  a  bequest  it  is  not  essential  that  a 
testator  use  the  word  "  give  "  or  the  word  "  be- 
queath "  or  any  word  of  similar  significance.  Matter 
of  Thompson,  5  Dem.  393. 


PROPERTY  AND  INTERESTS  TAXABLE.         47 

The  testator  by  the  first  clause  of  his  will  provided 
in  part  as  follows:  "  I  hereby  direct  my  executors 
hereinafter  named,  to  withdraw  one-half  of  each  of 
the  claims  and  demands  which  have  been  presented  by 
me  or  on  my  behalf,  to  the  executrix  of  the  will  of  my 
deceased  brother,  *  *  *  and  not  to  collect  any  more 
than  one-half  of  the  same  from  said  executrix,  and  I 
hereby  forgive  one-half  of  said  claims  and  demands 
against  my  said  brother's  estate."  Held,  that  the  ex- 
pression "  I  forgive  one-half,"  etc.,  amounts  to  a  be- 
quest of  that  half,  and  does  not  relieve  any  part  of 
the  whole  sum  from  taxation,  but  has  the  effect  of 
making  the  tax  on  that  one-half  assessable  to  the  exec- 
utrix as  such  and  not  to  her  as  an  individual.  Matter 
of  Wood,  40  Misc.  Eep.  155,  81  N.  Y.  S.  511. 

57.  Debts  Owing  by  Resident  to  Nonresident  Decedent. 
Debts  owing  by  a  resident  to  a  nonresident  decedent 

constitute  property  within  this  State  within  the  mean- 
ing of  the  statute  and  are  taxable.  Matter  of  Daly, 
100  App.  Div.  373-382 ;  affd.,  182  N.  Y.        ,  no  opinion. 

58.  Deposit  with  Trust  Company  Although  Certificates  There- 

for Are  Held  Without  this  State. 

Where  the  decedent  had  deposited  sums  of  money 
with  two  trust  companies  in  New  York  city  and  re- 
ceived from  said  companies  certificates  for  such  de- 
posits, respectively,  which  he  held  at  his  home  without 
this  State  at  the  time  of  his  death,  held  taxable.  Mat- 
ter of  Hewitt,  181  N.  Y.  Mem.  45,  affg.  98  App.  Div. 
624,  90  N.  Y.  S.  1100. 


48  THE    LAW    OF    TAXABLE   TRANSFERS. 

59.  Deposit  with  Bankers  to  Protect  a  Margin. 

A  deposit  by  a  nonresident  with  a  firm  of  New 
York  brokers  as  a  margin  with  which  to  protect  the 
nonresident's  interests  in  the  purchase  of  stock,  is 
taxable  upon  the  death  of  the  nonresident,  where  the 
money  has  remained  on  deposit  after  the  stock  trans- 
action, and  was  used  by  the  bankers  in  their  business. 
Matter  of  Daly,  100  App.  Div.  373,  182  N.  Y.  ,  no 
opinion. 

60.  Profits  when  Taxable. 

Profits  permitted  to  remain  on  deposit  with  the 
firm  are  to  be  included  in  the  taxable  assets.  Matter 
of  Probst,  40  Misc.  Rep.  431,  82  N.  Y.  S.  396. 

61.  Leasehold  Interests  in  Land. 

The  term  "  personal  property  "  is  now  used  in  the 
sl&tutes  to  designate  chattels,  and  every  species  of 
property  which  is  not  real  estate,  and,  therefore,  a 
leasehold  interest  in  land,  being  a  chattel,  is  subject 
to  taxation  as  personal  property  under  the  Transfer 
Tax  Law.  Matter  of  Althause,  63  App.  Div.  252-256, 
71  N.  Y.  S.  445;  affd.,  168  N.  Y.  670. 

62.  Money  Loaned  is  Not  an  Advancement. 

Money  loaned  by  testator  to  his  children  and  which 
he  directed  should  be  included  in  his  estate  and  di- 
vided equally  among  all  his  children,  the  loans  to  be 
deducted  from  the  share  of  the  children  to  whom  the 
same  were  made,  are  not  advancements  but  legacies 
subject  to  tax.  Matter  of  Bartlett,  4  Misc.  Rep.  380, 
25  N.  Y.  S.  990. 


PROPERTY  AND  INTERESTS  TAXABLE.         49 

63.  Fund  Held  for  Grantor's  Life  Reserving  Power  to  Dispose 

of  Same  by  Will. 

A  fund  held  by  a  trust  company  under  a  revocable 
trust  to  pay  the  income  to  the  testator  for  life  and  at 
his  death  the  principal  to  be  turned  over  to  the  ap- 
pointees named  in  his  will,  or  to  his  next  of  kin,  if 
such  appointment  is  not  made,  is  taxable  as  the  prop- 
erty passes  under  the  will  of  the  grantor.  Matter  of 
Ogsbury,  7  App.  Div.  71,  39  N.  Y.  S.  978. 

64.  Savings  Bank  Deposits  —  In  Trust,  Etc. 

A  deposit  by  one  person  of  his  own  money,  in  his 
own  name  as  trustee  for  another,  standing  alone,  does 
not  establish  an  irrevocable  trust,  during  the  lifetime 
of  the  depositor.  It  is  a  tentative  trust,  merely,  rev- 
ocable at  will,  until  the  depositor  dies  or  completes  the 
gift  in  his  lifetime  by  some  unequivocal  act  or  dec- 
laration, such  as  delivery  of  the  pass-book  or  notice  to 
the  beneficiary.  In  case  the  depositor  dies  before  the 
beneficiary  without  revocation  or  some  decisive  act 
or  declaration  of  disaffirmance,  the  presumption  arises 
that  an  absolute  trust  was  created  as  to  the  balance  on 
hand  at  the  death  of  the  depositor.  Matter  of  Totten, 
179  N.  Y.  112-126,  revg.  same  case,  89  App.  Div.  368, 
85  N.  Y.  S.  928. 

It  has  been  the  practice  to  consider  money  deposited 
in  trust  by  a  decedent  who  retained  the  bank-book  dur- 
ing his  lifetime,  and  withdrew  interest  and  principal, 
and  added  thereto  from  time  to  time,  as  a  gift  of  prop- 
erty of  the  decedent  intended  to  take  effect  at  or  after 
death,  and  therefore  taxable.  This  question  is  now  on 
4 


50  THE    LAW    OF    TAXABLE    TRANSFERS. 

appeal  to  the  surrogate  of  Rensselaer  county  in  the 
Matter  of  the  Charlotte  E.  King  Estate. 

In  the  Matter  of  Sheedy,  N.  Y.  Law  Journal,  May  25, 
1905,  Surrogate  Thomas,  upon  an  accounting  in  this 
estate,  held  that,  upon  all  the  facts  shown,  the  sum 
of  $3,000  deposited  by  the  decedent  in  the  Bowery  Sav- 
ings Bank  to  the  credit  of  "  Patrick  Sheedy  in  trust 
for  Joanna  Sheedy,"  was  a  part  of  the  decedent's  es- 
tate. *  *  *  That  the  rights  of  the  beneficiary  are 
at  most  conditional  and  defeasible,  and  do  not  become 
effectual  or  complete  until,  on  the  death  of  the  depos- 
itor, his  power  to  revoke  the  trust  is  gone  (citing  Mat- 
ter of  Totten,  179  N.  Y.  112),  and  if  the  beneficiary 
designated  is  not  then  alive  the  initiated  trust  is  alto- 
gether at  an  end,  and  the  fund  passes  to  the  legal  rep- 
resentatives of  the  depositor. 

65.  Id.  —  Joint  Accounts  —  Husband  and  Wife. 

The  most  frequent  deposits  of  this  nature  are  where 
a  deposit  is  made  in  a  savings  bank  in  the  joint  name 
of  husband  and  wife,  payable  to  either,  and  the  courts 
have  held  that,  where  the  money  was  the  husband's, 
the  act  of  depositing  it  in  the  joint  name  of  himself 
and  wife  would  indicate  an  intent  to  vest  in  the  wife 
title  to  the  money  should  she  survive  him.  Whitlock  v. 
Bowery  Savings  Bank,  36  Hun,  460 ;  Piatt  v.  Grupp,  41 
Hun,  477;  W ortmann  v.  Robinson,  44  Hun,  357. 

In  the  Matter  of  Augsbury  v.  Shurtleff,  180  N.  Y.  138, 
it  was  held  that  an  instrument  executed  by  husband 
and  wife  addressed  to  a  savings  bank,  in  which  each 
had  a  separate  account,  requesting  that  their  accounts 
be  merged,  so  as  to  run  to  either  or  to  the  survivor  of 


PROPERTY  AND  INTERESTS  TAXABLE.         51 

them,  constitutes  an  order  that  their  accounts  be, 
changed  so  as  to  make  each  the  joint  owner  of  the 
entirety,  so  that,  upon  the  death  of  one,  the  survivor 
would  become  the  owner  of  the  whole;  it  is  executory, 
however,  until  presented  to  the  bank  and  the  changes 
made,  and  consequently,  where  one  of  the  parties  died 
before  the  order  had  been  complied  with,  it  was  held 
that  the  instrument  did  not  create  either  a  gift  inter 
vivos  or  a  gift  causa  mortis  of  the  fund  belonging  to 
the  deceased  party. 

66.  Id.  —  Where  "  Either  or  the  Survivor  May  Draw." 

An  entry  in  a  savings  bank  pass-book  representing 
moneys  deposited  by  a  husband,  reading  "Albany  Sav- 
ings Bank  in  account  with  Mrs.  A.  P.  B.  or  J.  C.  B.,  her 
husband,  or  the  survivor  of  them, ' '  constitutes  the  par- 
ties joint  owners  of  the  deposit,  and  entitles  the  wife,  if 
she  survives  her  husband,  to  take  the  deposit,  and  it  is 
not  necessary  to  the  validity  of  the  gift  that  the  pass- 
book should  be  delivered  to  the  wife.  McElroy  v. 
Albany  Savings  Bank,  8  App.  Div.  46,  40  N.  Y.  S.  422; 
McElroy  v.  National  Savings  Bank,  8  App.  Div.  192, 
40  N.  Y.  S.  340.  Where  the  husband  dies  survived  by 
his  wife,  the  taxability  of  deposits  of  this  nature,  as 
being  a  gift  to  take  effect  at  or  after  the  decedent's 
death,  has  not  been  passed  upon. 

In  the  Matter  of  Hallenbeck  v.  Hallenbeck,  103  App. 
Div.  109,  it  appeared  that,  several  years  prior  to  dece- 
dent's death,  she  delivered  to  the  savings  bank  a  writ- 
ten direction  to  add  the  name  of  her  niece,  as. owner 
and  creditor  of  the  moneys  on  deposit  or  which  might 
thereafter  be  deposited  by  her,  so  that  either  or  the 


52  THE    LAW    OF    TAXABLE    TRANSFERS. 

survivor  might  draw  the  funds  in  part  or  in  whole,  and 
a  new  pass-book  was  issued,  which  read,  ' '  Huldah  Van 
Aernam  or  Huldah  B.  Hallenbeck.  Pay  to  either  or 
the  survivor  of  either.  In  account  with  Albany  County 
Savings  Bank,  Albany,  N.  Y."  It  was  held  that  the 
form  of  the  account  invested  Huldah  B.  Hallenbeck 
with  a  prima  facie  title  to  the  money  deposited  therein, 
and  that  before  such  prima  facie  title  could  be  de- 
stroyed there  must  be  a  finding  that  the  change  in  the 
account  was  made  for  some  other  purpose  than  to  pass 
title;  for  example,  for  the  convenience  of  Huldah  Van 
Aernam  in  making  withdrawals ;  that,  if  there  was  an 
understanding  that  such  transfer  and  change  of  ac- 
count was  in  payment  for  services,  such  consideration, 
however  slight,  was  good  as  between  the  parties  and 
passed  irrevocable  title  to  the  fund. 

To  the  same  effect,  see  Kelly  v.  Home  Savings  Bank, 
103  App.  Div.  141,  where  it  was  held  that,  with  respect 
to  alleged  gifts  of,  or  trusts  created  in,  savings  bank 
accounts,  unless  there  is  a  clearly  expressed  transfer 
or  trust  agreement  showing  the  interest  of  the  donor 
or  trustee,  whenever  there  is  an  apparent  attempt  to 
make  a  gift  or  create  a  trust,  the  interest  of  the  alleged 
donor  or  trustee  is  a  question  of  fact  to  be  determined 
after  an  examination  of  all  the  circumstances  in  each 
case. 

67.  Id.  —  "  Mother  or  Daughter." 

Where  the  decedent  deposited  a  sum  of  money  in  a 
savings  bank,  in  an  account  entitled  "  Julia  Cody  or 
daughter  Bridget  Bolin,"  and  the  pass-book  came  into 
the  hands  of  the  daughter,  who  thereafter  retained  it 


PROPEKTY  AND  INTERESTS  TAXABLE.         53 

during  her  mother 's  life,  it  appearing  that  the  mother, 
because  of  infirmities,  was  the  object  of  solicitude  and 
care,  the  court  held  on  the  accounting,  wherein  the 
daughter  claimed  the  deposit  as  a  gift,  that  the  facts 
did  not  authorize  the  inference  of  a  gift  or  a  transfer 
of  title.  Matter  of  Bolin,  136  X.  Y.  177.  To  the  same 
effect,  Wood  v.  Zomstorff,  59  App.  Div.  538,  69  N.  Y.  S. 
241. 

68.  Promissory  Note  Payable  to  Husband  and  Wife. 

In  the  Matter  of  Sanford  v.  Sanford,  45  N.  Y.  723, 
the  court  holds  that  if  one,  in  loaning  money,  takes  a 
promissory  note  therefor,  payable  to  the  order  of  him- 
self and  his  wife,  this  imports  a  gift  to  the  wife  in  case 
she  survives  him,  and  delivery  of  the  note  to  her  by 
the  husband  is  not  necessary  to  perfect  the  gift.  Dur- 
ing the  husband's  life  such  note  remains  subject  to  his 
control,  and  the  wife  has  no  legal  interest  therein  until 
his  decease.  Judge  Peckham  says :  ' '  The  note  being- 
payable  to  husband  and  wife  jointly  belonged  to  the 
wife  as  survivor.  *  *  *  Taking  this  note  in  the 
name  of  himself  and  wife  shows  that  the  husband  in- 
tended thereby  to  give  it  to  her  in  case  she  survived 
him,  and  a  delivery  to  her  was  unnecessary  to  perfect 
the  gift.  Assuming  this  to  be  so,  yet  during  the  life 
of  the  husband  the  note  is  subject  to  his  control  and 
disposition.  The  wife  has  no  legal  interest  in  it  until 
his  decease.' f  See  also  Fowler  v.  Butterly,  78  N.  Y. 
68-72. 

If  there  is  no  transfer  of  a  legal  interest  in  this  gift 
during  the  husband's  life,  it  would  seem  that  property 
so  held  could  only  be  considered  a  gift,  to  take  effect 


54         THE  LAW  OF  TAXABLE  TRANSFERS. 

at  or  after  the  donor's  death,  and  would  therefore  be 
liable  to  taxation. 

69.  Bond  and  Mortgage — Held  by  Husband  and  Wife  Jointly. 

Where  a  husband  and  wife  each  furnished  half  of 
the  amount  of  a  loan  and  took  as  security  therefor  a 
bond  and  mortgage  payable  to  them  jointly,  —  held, 
that,  upon  the  death  of  one  of  them,  the  interest  of  the 
decedent  vested,  not  in  the  survivor,  but  in  the  personal 
representatives  of  the  decedent.  Matter  of  Albrecht, 
136  N.  Y.  91. 

The  court  says :  ' '  We  are  aware  that  tliere  are 
many  authorities  holding  that  where  the  husband  pur- 
chases a  security  or  makes  a  deposit,  or  subscribes  for 
stock  in  the  joint  name  of  himself  and  wife  and  pays 
therefor  with  his  own  funds,  upon  his  death  the  entire 
security  belongs  to  the  wife  if  she  survives  him.  But 
the  decision  in  all  these  cases  is  put  upon  the  ground 
that  it  is  apparent  from  the  character  of  the  transac- 
tion that  the  husband  intended  to  give  the  property  to 
his  wife  in  the  event  of  her  survivorship,  and  hence 
the  transfer  possesses  all  the  essential  qualities  of  a 
gift  causa  mortis,  which  he  may  revoke  in  his  lifetime 
and  which  does  not  take  effect  until  his  death  if  not 
previously  recalled.  While  he  lives  his  control  over  it 
is  unlimited  and  at  his  death  it  becomes  her  absolute 
property,  if  she  survives  him,  but  if  she  does  not  the 
gift  is  not  consummated,  and  the  husband  retains  the 
entire  title.  *  *  *  But  if  the  husband  and  wife 
each  contribute  to  a  joint  investment  or  to  the  purchase 
of  a  security  and  the  title  is  taken  in  their  joint  names 
to  be  held  by  them,  their  executors,  administrators,  or 


PROPERTY  AND  INTERESTS  TAXABLE.  55 

assigns,  as  was  the  bond  and  mortgage  in  the  present 
ease,  no  presumption  can  properly  arise  from  the  na- 
ture of  the  act  that  either  intended  to  make  a  gift  of 
his  or  her  share  to  the  survivor." 

70.  Taxability  of  an  Estate  —  What  Law  Determines. 

The  taxability  of  an  estate  is  to  be  determined  by 
the  law  in  existence  at  the  date  of  the  transfer,  not- 
withstanding a  subsequent  alteration  of  the  law.  Mat- 
ter of  Goelet,  78  N.  Y.  S.  47;  Matter  of  Davis,  149  N. 
Y.  539. 

71.  Legacy  in  Lieu  of  Dower  is  Not  a  Debt  of  the  Estate. 

The  decedent  bequeathed  to  his  wife  the  sum  of 
$10,000,  and  also  devised  to  her  a  certain  house  and 
lot  in  New  York  city.  He  provided  that  the  gifts  to 
his  wife  should  be  in  lieu  and  bar  of  dower  as  follows : 
"  I  expressly  declare  the  foregoing  bequest  and  de- 
vise to  my  said  wife  to  be,  with  the  provisions  already 
made  for  her,  in  lieu  and  full  satisfaction  of  all  dower 
*  *  *."  Subsequent  to  making  the  will,  the  testator 
conveyed  to  his  wife  all  real  estate  which  by  his  will 
he  had  devised  to  her.  The  widow  accepted  the  pro- 
visions of  the  will  in  lieu  of  her  dower,  and  contention 
was  made  that  the  legacy  of  $10,000  was  not  taxable, 
as  it  was  in  effect  an  obligation  or  debt  on  the  part 
of  the  estate  as  the  consideration  for  the  release  of  the 
dower  right  of  the  widow,  which  was  not  taxable.  The 
court  held  the  legacy  of  $10,000  taxable,  saying:  "  If 
the  construction  of  the  appellants  was  correct,  a  dower 
right  which  is  an  interest  in  real  estate  not  subject  to 
a  tax,  or  to  the  testator's  disposition,  could  be  dis- 


56  THE    LAW    OF    TAXABLE    TRANSFERS. 

charged  of  the  personal  property  and  thus  the  State 
would  lose  the  benefit  of  the  tax.  If  such  a  proposition 
were  sound,  it  would  be  an  easy  way  for  testators  to 
obviate  the  taxes  upon  gifts  of  personal  property  to 
their  wives  by  simply  making  the  gift  as  a  considera- 
tion for  a  release  of  dower  in  the  real  estate."  Matter 
of  DeGraaf,  24  Misc.  Rep.  147,  53  N.  Y.  S.  591. 

Reference  to  other  taxable  transfers,  including  the  property  of  non- 
resident decedents,  see  chapters  V,  VI,  and  VII. 


CHAPTER  IV. 


Taxable  Transfers 


-  Property  and  Interests  not 
Taxable. 


(  §  220,  Tax  Law. ) 


72.  Accrued  rights ;  prior  to  Trans- 

fer Tax  Law. 

73.  Estates    vested,    prior    to    the 

Transfer  Tax  Law. 

74.  Increase    accruing    after    dece- 

dent's death. 

75.  Bequest  for  burial  plot. 

76.  Interest  or  share  of  a  decedent 

in  an  undistributed  estate. 

77.  Legacy  to  executors  subject  to 

a  trust. 

78.  Legacy;  given  in  consideration 

of  a  home. 

79.  Absolute    bequest    with    preca- 

tory words  in   favor  of  ex- 
empt corporations. 

80.  United    States    bonds    between 

May  1,  1892,  and  March  21, 
1898. 

81.  Stocks  pledged  as  collateral  to 

a  loan. 

82.  Legacy  to  a  brother  chargeable 

on  land. 

83.  Articles    mentioned    in    section 

2713  of  the  Code. 


84.  Proceeds  of  gratuity  fund  of 
New  York  Produce  Ex- 
change. 

85.  Fund  provided  by  will  to  pay 
annuity  created  by  trust 
company. 

86.  Real  property  without  this 
State  not  taxable. 

87.  Legacy  to  be  taxable  must  be 
paid  from  property  of  dece- 
dent. 

88.  Legacy  to  a  corporation  not  in 
existence. 

89.  Legacy  is  a  naked  right  until 
reduced  to  possession. 

90.  Transfer  of  property  by  ante- 
nuptial agreement. 

91.  Property  transferred  by  reason 
of  contract  obligations,  held 
not  taxable. 

92.  Advancements. 

93.  Remainders  and  reversions  un- 
der the  earlier  law. 

94.  Chose  in  action ;  when  taxable. 

95.  Is  the  widow's  dower  taxable? 

96.  Curtesy. 

Reference  to  other   nontaxable   transfers,   including  the   property   of 
nonresident  decedents,  see  chapters  V,  VI,  and  VII. 

72.  Accrued  Rights  —  Prior  to  Transfer  Tax  Law. 

Rights  "  accruing  "  under  a  trust  deed  executed 
prior  to  the  enactment  of  the  Transfer  Tax  Law, 
whether  such  rights  are  vested  or  contingent,  are  not 
taxable.  Matter  of  Craig,  97  App.  Div.  289,  89  N.  Y.  S. 
971 ;  affd.,  181  N.  Y.  Mem.  49. 

[57] 


58  THE    LAW    OF    TAXABLE    TRANSFERS. 

73.  Estates  Vested  Prior  to  the  Transfer  Tax  Law. 

Interests  in  estates  which  became  vested  before  the 
passage  of  the  Transfer  Tax  Law  are  not  taxable  under 
said  act.  Matter  of  Travis,  19  Misc.  Rep.  393,  44 
N.  Y.  S.  349;  Matter  of  Pell,  171  N.  Y.  48. 

74.  Increase  Accruing  After  Decedent's  Death. 

Only  the  property  of  which  a  person  dies  seized  or 
possessed  is  taxable,  therefore  the  increase  or  interest 
accruing  thereon  subsequent  to  decedent 's  death  is  not 
taxable.     Matter  of  Vassar,  127  N.  Y.  1. 

75.  Bequest  for  Burial  Plot. 

A  bequest  for  purchase  of  or  maintenance  of  the  de- 
cedent 's  burial  lot  has  been  held  exempt  as  a  part  of 
the  funeral  expenses  of  the  decedent.  Matter  of  Vinot, 
7  N.  Y.  S.  517;  Matter  of  Edgerton,  35  App.  Div. 
125,  54  N.  Y.  S.  700;  aftU,  158  N.  Y.  671. 

76.  Interest   or   Share   of   a   Decedent   in   an   Undistributed 

Estate. 

Where  the  personal  estate  of  a  decedent  consisted 
only  of  her  distributive  share  in  the  estate  of  a  de- 
ceased sister,  no  part  of  which  came  into  the  hands 
of  the  testatrix  before  her  death,  held,  that  such  por- 
tion of  the  decedent's  estate  was  not  taxable.  Matter 
of  Thomas,  3  Misc.  Rep.  388,  24  N.  Y.  S.  713.  See  also 
Matter  of  Phipps,  77  Hun,  325,  28  N.  Y.  S.  330;  Matter 
of  Zefita,  167  N.  Y.  280. 

77.  Legacy  to  Executors,  Subject  to  a  Trust. 

Where  the  testatrix  bequeaths  all  her  property  to  her 
executor  individually,  agreeing  with  him  at  the  time 


PROPERTY  AND  INTERESTS  NOT  TAXABLE.       59 

the  will  was  executed  that  the  bequest  shall  be  in  trust 
for  decedent's  brother,  such  a  trust  is  within  the  ex- 
emptions of  the  statute  which  provides  for  the  payment 
of  taxes  upon  gifts,  legacies,  and  collateral  inherit- 
ances, and  the  executor  would  therefore  not  be  liable 
for  the  tax.  Matter  of  Farley,  15  N.  Y.  St.  R,  727-729. 
Decision  under  Act  of  1885. 

78.  legacy  —  Given  in  Consideration  of  a  Home. 

Under  the  Act  of  1887,  where  a  testatrix  by  will 
gave  all  her  property  to  her  nephew,  in  consideration 
of  a  home  for  her  at  his  house  during  her  life,  it  was 
held  that  the  property  given  to  the  nephew  by  the 
will  as  a  legacy  was  really  in  satisfaction  of  a  claim 
which  he  might  enforce  as  a  creditor  against  the  estate 
of  the  testatrix,  and  therefore  is  a  payment  and  not  a 
gift,  and  is  not  subject  to  the  collateral  inheritance  tax. 
Matter  of  Ilulse,  39  N.  Y.  St.  R,  402.  Decision  under 
Act  of  1887,  15  N.  Y.  S.  770. 

A  similar  bequest  would  now  be  held  taxable  in  view 
of  the  decision  of  the  Court  of  Appeals  in  In  re  Gould, 
156  N.  Y.  423. 

79.  Absolute  Bequest    with  Precatory  Words  in  Favor  of  Ex- 

empt Corporations. 

Where,  after  an  absolute  bequest,  the  decedent  in 
his  will  immediately  follows  such  bequest  with  preca- 
tory words  of  desire  or  recommendation,  that  the  de- 
vise and  bequest,  and  all  the  proceeds  thereof  be  ap- 
plied to  certain  corporations  exempt  under  the  Trans- 
fer Tax  Law  from  taxation,  such  bequest  is  not  tax- 
able where  it  is  shown  that  the  clause  in  question  was 


60  THE    LAW    OF    TAXABLE    TRANSFERS. 

inserted  in  the  will  on  the  express  agreement  that  the 
bequest  shall  be  so  applied.  Matter  of  Murphy,  4  Misc. 
Rep.  230,  25  N.  Y.  S.  107.  See  Matter  of  Edson,  38 
App.  Div.  19,  56  N.  Y.  S.  409,  where  a  legacy,  absolute 
in  terms,  but  impressed  by  extrinsic  proof  with  a  trust, 
was  held  taxable. 

80.  United  States  Bonds  Between  May  1,    1892,  and  March 

21,   1898. 

The  transfer  of  United  States  bonds  was  not  sub- 
ject to  the  provision  of  the  Transfer  Tax  Law  be- 
tween the  1st  day  of  May,  1892,  and  the  21st  day  of 
March,  1898,  owing  to  the  provision  of  section  22  of 
the  Act  of  1892  (now  section  242,  as  amended),  which 
contained  the  phrase  ' '  property     *  *     over  which 

this  State  has  any  jurisdiction  for  the  purpose  of  taxa- 
tion." Matter  of  Whiting,  150  N.  Y.  27;  Matter  of 
Sherman,  153  N.  Y.  1. 

Since  March  21,  1898,  such  bonds  are  taxable.  Mat- 
ter of  Plummer,  30  Misc.  Rep.  19,  62  N.  Y.  S.  1024; 
affd.,  47  App.  Div.  625,  62  N.  Y.  S.  1145,  161  N.  Y.  631, 
178  U.  S.  115. 

81 .  Stocks  Pledged  as  Collateral  to  a  Loan. 

Stocks  pledged  by  the  decedent  with  brokers  as  col- 
lateral security  for  a  loan,  the  title  thereto  passes  to 
the  brokers,  and  where  the  stocks  sell  for  less  than 
the  loan  no  proceeds  thereof  can  pass  to  the  decedent's 
estate,  and  therefore  no  transfer  tax  can  be  assessed 
on  account  of  the  stock.  Matter  of  Havemeyer,  32 
Misc.  Rep.  416,  66  N.  Y.  S.  722.  See  also  Matter  of 
Pullman,  46  App.  Div.  574,  62  N.  Y.  S.  395.    If  pledged 


PROPERTY  AND  INTERESTS  NOT  TAXABLE.       61 

stocks  are  redeemed  by  the  executors  they  are  then 
liable  to  tax.  Matter  of  Hurcomb,  36  Misc.  Rep.  755, 
74  N.  Y.  S.  475. 

82.  legacy  to  a  Brother  Chargeable  on  Land. 

A  legacy  to  a  brother,  chargeable  upon  decedent's 
real  estate,  is  an  interest  in  land  and  is  not  taxable. 
Matter  of  Cheesebrough,  34  Misc.  Rep.  365,  69  N.  Y.  S. 
848  (citing  Matter  of  Sutton,  3  App.  Div.  208,  38 
N.  Y.  S.  277;  Matter  of  Offerman,  25  App.  Div.  94,  48 
N.  Y.  S.  993).    Decisions  prior  to  chap.  41,  Laws  1903. 

83.  Articles  Mentioned  in  Section  2713  of  the  Code. 

In  view  of  the  declaration  of  Code  of  Civil  Proce- 
dure, section  2713,  that  if  a  man  having  a  family  dies, 
leaving  a  widow  or  a  minor  child,  the  articles  enu- 
merated in  said  section  "  shall  not  be  deemed  assets," 
but  shall  belong  to  her ;  they  form  no  part  of  his  estate 
and  are  not  subject  to  the  transfer  tax,  whether  or  not 
they  were  actually  set  apart  to  her  by  the  appraiser. 
Matter  of  Page,  39  Misc.  Rep.  220,  79  N.  Y.  S.  382. 

But  where  the  husband  dies  and  does  not  leave  the 
specific  articles  enumerated  in  said  section  2713  of 
the  Code,  the  widow  is  not  entitled  to  the  cash  value 
of  said  articles  in  lieu  thereof.  Matter  of  Libolt,  102 
App.  Div.  29. 

84.  Proceeds  of  Gratuity  Fund  of  New  York  Produce   Ex- 

change. 
The  proceeds  realized  from  the  gratuity  fund  of  the 
New  York  Produce  Exchange  are  not  taxable,  as  they 


62  THE    LAW    OF    TAXABLE    TRANSFERS. 

are  payable  to  the  beneficiaries  entitled  thereto  by 
virtue  of  the  by-laws  of  the  Produce  Exchange  relat- 
ing to  the  manner  of  distribution,  and  therefore  are 
transferred,  not  by  the  will  of  the  decedent  or  by  the 
statute,  but  by  virtue  of  the  contract  of  the  deceased 
with  the  exchange.  Matter  of  Fay,  25  Misc.  Eep.  468, 
55  N.  Y.  S.  749. 

85.  Fund  Provided  by  Will  to  Pay  Annuity  Created  by  Trust 

Agreement. 

Where  a  husband  had,  through  a  trustee,  agreed  to 
pay  his  wife  a  life  annuity,  accompanied  by  the  option 
to  her  of  demanding  at  his  death  from  his  estate,  and 
in  substitution  of  such  annuity,  a  gross  sum  calculated 
upon  the  expectancy  of  her  life  as  will  discharge  pro- 
spective payments  of  the  annuity,  his  creation  by  will 
of  a  trust  to  continue  the  annuity  in  case  she  refuses 
to  accept  the  gross  sum  is  not,  if  she  fails  to  exercise 
her  option,  subject  to  tax,  as  the  will  transfers  nothing 
to  her.  Matter  of  Daniell,  40  Misc.  Rep.  329,  81  N.  Y. 
S.  1033. 

86.  Real  Property  Without  this  State  Not  Taxable. 

Real  property  of  the  decedent  situated  out  of  this 
State  is  not  subject  to  appraisal,  and  where  the  dece- 
dent owned  real  property  without  the  State,  and  di- 
rected his  executors  to  sell  such  real  property  for  the 
purpose  of  paying  legacies  and  making  distributions, 
the  doctrine  of  equitable  conversion  cannot  be  invoked 
to  subject  the  property  or  the  proceeds  of  sale  thereof 
to  taxation.     Matter  of  Swift,  137  N.  Y.  77. 


PROPERTY  AND  INTERESTS  NOT  TAXABLE.       63 

87.  legacy  to  be  Taxable  Must  be  Paid  From  Property  of 

Decedent. 

Where  a  legatee  procured  from  the  executors  the 
amount  of  her  legacy,  giving  such  executors  an  assign- 
ment thereof,  and  it  subsequently  appears  that  the 
legacy  was  paid  from  the  executors'  own  money,  and 
that  the  testator's  estate  was  insufficient  to  pay  the 
said  legacy, —  held,  that,  as  the  legatee  was  not  paid 
from  funds  of  the  estate,  the  legacy  was  not  taxable  as 
against  her,  nor  was  it  taxable  against  the  estate  of  the 
executor  (who  had  subsequently  died)  on  the  amount 
paid  to  the  legatee.  Matter  of  Weed,  10  Misc.  Rep. 
628,  32  N.  Y.  S.  777. 

88.  Legacy  to  a  Corporation  Not  in  Existence. 

The  decedent  by  will  gave  a  legacy  chargeable  upon 
land  to  a  corporation,  which  the  decedent,  upon  cer- 
tain specified  contingencies,  expresses  a  wish  to  have 
incorporated,  and,  in  appraisal  of  the  decedent's  estate, 
the  value  of  this  legacy  was  ascertained  and  appraised. 
Held,  that,  as  no  such  corporation  has  ever  been  cre- 
ated, the  legacy  is  not  taxable,  as  no  interest  can  pass  to 
a  body  corporate  which  has  no  existence.  Matter  of 
Cheesebrough,  34  Misc.  Rep.  365,  69  N.  Y.  S.  848.  The 
effect  of  this  decision  is  to  render  such  a  legacy  void. 
But  see  Matter  of  Graves,  171  N.  Y.  40,  where  a  devise 
to  trustees  for  the  purpose  of  founding  and  maintain- 
ing "  a  home  for  the  aged  "  was  held  exempt  from 
taxation  as  though  the  gift  were  in  the  possession  of  a 
corporation  or  association  already  formed  under  the 
will. 


64  THE    LAW    OF    TAXABLE    TRANSFERS. 

89.  Legacy  is  a  Naked  Eight  Until  Reduced  to  Possession. 

Until  a  legacy  is  reduced  to  possession  it  is  a  mere 
naked  right  in  an  estate  to  be  administered,  and  is  not 
subject  to  tax.  Matter  of  Phipps,  77  Hun,  325,  28 
N.  Y.  S.  330;  affd.,  143  N.  Y.  641. 

90.  Transfer  of  Property  by  Antenuptial  Agreement. 

On  April  7,  1893,  Miller  made  an  antenuptial  agree- 
ment in  writing,  reciting  his  intended  marriage  to  a 
Miss  Tefft,  and  his  desire  to  make  pecuniary  provision 
for  her,  whereby  he  transferred  to  her  2,000  shares  of 
the  preferred  capital  stock  of  the  Phcenix  Horse  Shoe 
Company  of  Illinois.  On  April  8,  1893,  one  day  there- 
after, Miller  and  Miss  Tefft  entered  into  another  agree- 
ment, whereby, ' '  in  consideration  of  the  intended  inter- 
marriage of  the  parties,"  Miss  Tefft  transferred  unto 
Miller  the  above  2,000  shares  of  stock,  upon  the  trust 
to  invest  and  reinvest  the  same  and  change  the  invest- 
ment with  her  approval,  and  Miller  was  to  receive  and 
apply  to  the  mutual  use  of  both  parties  the  income 
arising  therefrom  during  their  joint  lives.  Upon  the 
death  of  either  the  trust  was  to  terminate,  and  if  Miss 
Tefft  died  first  the  trust  fund  was  then  to  become  the 
property  of  Miller  absolutely,  freed  from  all  trusts  and 
conditions,  and  the  same  condition  was  made  for  Miss 
Tefft  if  Miller  died  first.  The  parties  were  married 
on  April  8, 1893,  after  the  execution  of  the  trust  agree- 
ment. Miller  died  on  January  19,  1901,  leaving  his 
wife  surviving,  and  also  a  will,  in  which  he  referred  to 
the  transfer  to  his  wife  and  gave  her  all  the  right, 
title,  and  interest  he  might  have,  if  any,  in  and  to  the 
2,000  shares  of  stock  aforesaid.  The  court  held  that 
the  property  transferred  was  not  subject  to  tax,  it 


PROPERTY  AND  INTERESTS  NOT  TAXABLE.       65 

appearing  that  the  two  agreements  were  not  contempo- 
raneous, and  that  the  original  transfer  was  for  a  good 
and  valid  consideration.  Matter  of  Miller,  77  App. 
Div.  473,  78  N.  Y.  S.  930. 

In  the  Matter  of  Baker,  83  App.  Div.  530,  82  N.  Y.  S. 
390;  affd.,  178  N.  Y.  575,  the  decedent  entered  into 
an  antenuptial  agreement  with  his  intended  wife,  by 
which  he  agreed  that  if  the  marriage  should  occur, 
and  she  should  survive  him,  he  would  make  provision 
by  his  will  for  the  payment  to  her  from  his  estate  of 
$20,000.  His  intended  wife  agreed  to  accept  the  pro- 
vision of  the  agreement  in  lieu  of  her  dower  and  other 
rights  in  her  husband's  estate.  Their  marriage  sub- 
sequently occurred  and  the  husband  died  intestate, 
leaving  his  widow  and  a  sister  surviving.  By  agree- 
ment the  widow  accepted,  in  part  payment  of  the 
$20,000,  the  avails  of  a  $10,000  life  insurance  policy 
upon  her  husband's  life,  which  had  been  transferred 
to  her  prior  to  her  husband's  death,  and  the  remain- 
ing $10,000  was  subsequently  paid  to  her  from  her 
husband's  estate.  Held,  that  the  claim  of  the  widow 
for  $10,000  under  the  antenuptial  agreement  was  in 
the  nature  of  a  debt,  and  therefore  not  taxable  as  a 
transfer  made  in  contemplation  of  the  death  of  the 
donor,  or  intended  to  take  effect  in  possession  or  enjoy- 
ment at  or  after  such  death. 

91.  Property  Transferred  by  Reason  of  Contract  Obligations, 
Held  Not  Taxable. 

Property,  passing  to  the  natural  daughter  of  an 
intestate  dying  in  1900,  under  a  judgment  of  the  Su- 
preme Court,  awarding  to  her  in  1901  specific  per- 
5 


66  THE  LAW  OF  TAXABLE  TRANSFERS. 

forruance  of  a  contract  her  father  made  with  her 
mother  in  1862,  by  the  terms  of  which,  upon  surrender 
of  the  natural  daughter  to  him,  his  property  remaining 
at  his  death  should  belong  to  her,  is  not  subject  to  the 
transfer  tax,  as  the  transfer  was  neither  by  will  nor 
by  the  intestate  laws,  or  by  bargain  and  sale  or  gift 
made  in  contemplation  of  death,  or  to  take  effect  in 
use  or  enjoyment  thereafter.  Matter  of  Demers,  41 
Misc.  Rep.  470,  84  N.  Y.  S.  1109. 

92.  Advancements. 

The  court  says  in  the  Matter  of  Edgerton,  35  App. 
Div.  125-130,  54  N.  Y.  S.  700;  affd.,  158  N.  Y.  671: 
"  It  is  hardly  claimed  that  a  gift  inter  vivos  or  an  ad- 
vancement simply,  would  be  within  the  provision  of  the 
law."  Matter  of  Spaulding,  49  App.  Div.  541,  63 
N.  Y.  S.  694. 

93.  Remainders  and  Reversions    under    the  Earlier  Law. 

Remainders  and  reversions  created  before  the  Trans- 
fer Tax  Law,  although  vesting  in  possession  or  enjoy- 
ment thereafter,  are  not  taxable,  as  the  right  of  the 
State  attaches  when  the  right  of  succession  accrues. 
Matter  of  Seaman,  147  N.  Y.  69 ;  Matter  of  Gibson,  33 
App.  Div.  628,  53  N.  Y.  S.  1104;  affd.,  157  N.  Y.  680; 
Matter  of  Langdon,  11  App.  Div.  220,  43  N.  Y.  S.  419; 
affd.,  153  N.  Y.  6. 

94.  Chose  in  Action  —  When  Taxable. 

Where  a  legatee  dies  before  receiving  his  legacy  or 
distributive  share,  no  transfer  tax  can  be  imposed  upon 
this  portion  of  the  legatee's  estate  until  the  settlement 
of  the  estate  of  the  decedent  in  which  the  legacy  or  dis- 


PROPERTY  AND  INTERESTS  NOT  TAXABLE.       67 

tributive  share  was  created,  because,  until  a  distribu- 
tion has  been  made,  nothing  has  been  transferred. 
Matter  of  Phipps,  77  Hun,  325,  28  X.  Y.  S.  330;  affd., 
143  N.  Y.  644;  Matter  of  Zefita,  44  App.  Div.  340,  60 
N.  Y.  S.  927;  affd.,  167  N.  Y.  280. 

The  Appellate  Division,  in  the  Matter  of  Clinch,  99 
App.  Div.  298;  affd.,  180  X.  Y.  300,  says,  —  up  to  that 
time  there  was  a  mere  claim  on  the  part  of  Robert  (the 
deceased  legatee)  or  his  executors  against  his  father's 
executors  for  a  share  or  interest  in  the  father's  estate, 
which  passed  by  his  will:  "  Such  claim  was,  at  most, 
a  mere  chose  in  action,  which  followed  the  residence  of 
the  claimant  and,  as  indicated,  it  would  be  impossible 
to  determine  as  to  what  property,  if  any,  would  be  ulti- 
mately transferred  by  reason  of  it.  But  when  an 
actual  distribution  had  taken  place,  that  which  there- 
tofore was  uncertain  became  certain,  and  at  that  mo- 
ment a  tax  attached  to  the  transfer."  Citing  Matter 
of  Huber,  86  App.  Div.  458,  83  N.  Y.  S.  769. 

95.  Is  the  Widow's  Dower  Taxable? 

One  of  the  first  questions  raised  when  chapter  41, 
Laws  1903,  went  into  effect,  March  16th  of  that  year, 
taxing  the  real  as  well  as  the  personal  property  of  a 
decedent,  passing  to  those  in  the  1-per-cent.  class,  was 
whether  the  widow's  dower  was  taxable? 

The  practice  has  been  to  consider  the  widow's  dower 
as  not  subject  to  the  provisions  of  the  Transfer  Tax 
Law  for  the  reason,  doubtless,  that  it  is  not  transferred 
to  her  by  will,  or  the  intestate  laws,  within  the  meaning 
of  the  statute.  And  the  value  of  the  widow's  dower 
has  accordingly  been  computed  and  deducted  from  the 


68  THE    LAW    OF    TAXABLE    TRANSFERS. 

appraised  value  of  the  real  estate,  and  the  residue  only 
has  been  subject  to  tax.*  Matter  of  Riemann,  42  Misc. 
Rep.  648,  87  N.  Y.  S.  731. 

The  Court  of  Appeals  held  in  Chamberlain  v.  Cham- 
berlain, 43  N.  Y.  424,  that  a  dower  right  at  the  time  of 
testator's  death  is  the  property  of  the  widow  and  not 
of  the  testator,  and  is  therefore  not  devisable. 

96.  Curtesy. 

It  would  seem  that  since  the  enabling  acts,  allowing 
married  women  to  sell  and  devise  their  lands,  that  a 
husband's  right  as  tenant  by  the  curtesy  initiate  as  to 
the  lands  acquired  by  the  wife,  consists  simply  of  a 
status,  which  is  never  a  vested  right,  and  is  not  sepa- 
rately alienable  during  coverture,  but  may  be  modified 
or  annulled  at  any  time  before  it  becomes  consummate 
by  the  death  of  the  wife.  Thurber  v.  Toumsend,  22 
N.  Y.  517 ;  Matter  of  Clark,  40  Hun,  233.  The  taxability 
of  this  life  estate  of  the  husband  under  the  Transfer 
Tax  Law  has  never  been  passed  upon  by  the  courts, 
although  it  is  apparent  that  while  curtesy  is  initiate, 
it  is  not  an  estate,  but  a  simple  possibility  or  expect- 
ancy which  may  be  destroyed  at  the  will  of  the  owner 
of  the  fee. 

Reference  to  other  nontaxable  transfers,  including  the  property  of 
nonresidents,  see  chapters  V,  VI,  and  VII. 

*  A  wife's  inchoate  right  of  dower  is  not  derived  from  her  hus- 
band, but  it  vests  at  the  moment  of  the  grant  to  her  husband  and 
she  takes  it  constructively  as  purchaser  from  the  grantor.  Kursheedt 
v.  Union  Dime  Savings  Institution  of  City  of  ~New  York,  118  N.  Y.  358. 

When  it  was  essential  under  an  early  statute  of  this  State  to  deter- 
mine the  relation  of  the  wife  to  the  grant  made  of  land  to  her  husband, 
it  was  held  that  the  wife's  inchoate  right  of  dower  vested  at  the  moment 
of  the  grant  to  the  husband ;  and  that  she  took  such  right,  constructively, 
as  purchaser  from  the  grantor.  Sutliff  v.  For  gey,  1  Cow.  89:  5  id.  713; 
Priest  v.  Cummings,  20  Wend.  61;  Lawrence  v.  Miller,  2  N.  Y.  251. 

Qu&re. —  In  case  the  husband  is  seized  of  real  property  at  the  time 
of  his  marriage,  how  can  this  rule  apply  as  to  the  widow's  dower  in 
such  property? 


CHAPTER  V. 


Taxable  Transfers  —  In  Contemplation  of  Death  — 
Or  to  Take  Effect  at  or  After  Death. 

(§  220,  Tax  Law.) 


97.  The  general  subject. 

98.  Gifts   made   in   contemplation 

of   the   death   of  the    donor. 
etc. 

99.  Distinction  between  gifts  inter 

vivos  and  causa  mortis. 

100.  Literal     construction     of     the 

statute  not  intended. 

101.  Transfers;    made    in    contem- 

plation of  death. 

102.  To     what     the     words     '•  in 

contemplation     of     death " 
refer. 

103.  Transfers    not    made    in    con- 

templation     of     death     of 
donor. 


104.  Transfers   taking  effect  at   or 

after  donor's  death. 

105.  When   a   trust   deed   does   not 

constitute  an  absolute  gift. 
10G.  Gift    where    donee    only    sur- 
vived the  donor  thiee  days. 

107.  Gifts      upon      conditions      or 

agreement. 

108.  Transfer  not  made  to  take  ef- 

fect    at     or     after     donor's 
death. 

109.  Vested  interest,  although  will 

contains  no  words  of  present 
gifts. 

110.  Gift;    agreement    to   care    for 

donor  for  life. 


97.  The  General  Subject. 

The  statute  relating  to  taxable  transfers  refers  ex- 
clusively to  the  transfer  of  property  by  will  or  the 
intestate  laws,  except  "  when  the  transfer  is  of  prop- 
erty made  by  a  resident  or  by  a  nonresident  when  such 
nonresident's  property  is  within  this  State,  by  deed, 
grant,  bargain,  sale  or  gift  made  in  contemplation  of 
the  death  of  the  grantor,  vendor  or  donor,  or  intended 
to  take  effect  in  possession  or  enjoyment  at  or  after 
such  death."    Subd.  3,  §  220. 

The  provision  referring  to  a  transfer  "  made  in 
contemplation  of  the  death  of  the  grantor,  vendor  or 
donor,"  was  first  inserted  in  the  statute  by  chapter 

[G9] 


70  THE    LAW    OF    TAXABLE    TRANSFERS. 

215,  Laws  of  1891.  The  other  provision  referring  to 
a  transfer  "  intended  to  take  effect  in  possession  or 
enjoyment  at  or  after  such  death,"  or  words  to  that 
effect,  was  contained  in  section  1  of  the  original  Act 
of  1885.  Both  of  the  foregoing  provisions  were  neces- 
sary, as  otherwise  anyone  wishing  to  evade  the  tax 
might  easily  do  so  by  a  gift  or  grant  of  his  whole 
estate  immediately  before  his  death,  or  by  executing  a 
written  contract  or  agreement  with  the  grantee  or 
donee  which  would  be  effectual,  upon  such  person's 
death,  to  pass  the  title  to  all  his  property  to  those  who 
were  to  be  the  intended  objects  of  his  bounty. 

98.  Gifts  Made  in  Contemplation  of  the  Death  of  the  Donor, 

Etc. 

Transfers  contemplated  by  this  subdivision  neces- 
sarily include  gifts  inter  vivos  and  gifts  causa  mortis. 

99.  Distinction  Between  Gifts  Inter  Vivos  and  Causa  Mortis. 

In  Ridden  v.  Thrall,  125  N.  Y.  572,  the  court  points 
out  the  distinction  between  a  gift  inter  vivos  and  a  gift 
causa  mortis,  Judge  Earl,  in  his  opinion,  stating,  at 
page  579 : 

"  Gifts  causa  mortis  as  well  as  gifts  inter  vivos  are 
based  upon  the  fundamental  right  everyone  has  of  dis- 
posing of  his  property  as  he  wills.  The  law  leaves  the 
power  of  disposition  complete,  but  to  guard  against 
fraud  and  imposition,  regulates  the  methods  by  which 
it  is  accomplished." 

To  consummate  a  gift,  whether  inter  vivos  or  causa 
mortis,  the  property  must  be  actually  delivered  and  the 
donor  must  surrender  the  possession  and  dominion 


TKANSFERS IN    CONTEMPLATION    OF    DEATH.  71 

thereof  to  the  donee.  In  the  case  of  gifts  inter  vivos, 
the  moment  the  gift  is  thus  consummated  it  becomes 
absolute  and  irrevocable.  But  in  the  case  of  gifts 
causa  mortis  more  is  needed.  The  gift  must  be  made 
under  the  apprehension  of  death  from  some  present 
disease  or  some  other  impending  peril,  and  it  becomes 
void  by  recovery  from  the  disease  or  escape  from  the 
peril.  It  is  also  revocable  at  any  time  by  the  donor, 
and  becomes  void  by  the  death  of  the  donee  in  the  life- 
time of  the  donor.  It  is  not  needful  that  the  gift  be 
made  in  extremis  when  there  is  no  time  or  opportunity 
to  make  a  will. 

It  is  often  difficult  to  determine  when  a  gift  has  been 
made  in  contemplation  of  death  within  the  meaning  of 
the  statute.  Xo  one  would  contend  that  if  a  person, 
fully  realizing  that  his  death  would  occur  within  a  few 
hours,  should  convey  by  deed  his  real  estate  and  receive 
the  full  consideration  therefor,  that  such  a  transfer 
would  be  taxable,  although  the  conveyance  was  clearly 
made  "  in  contemplation  of  death;"  or,  if  a  person 
under  similar  circumstances  should  transfer  personal 
property  in  payment  of  a  debt,  stating  that  he  desired 
to  have  all  debts  adjusted  before  his  death,  the  statute 
would  not  apply,  although  the  transaction  would  be 
within  its  provisions,  if  literally  construed. 

100.  Literal  Construction  of  the  Statute  not  Intended. 

The  court  said,  in  the  Matter  of  Spaulding,  49  App. 
Div.  541,  63  N.  Y.  S.  694;  affd.,  163  N.  Y.  607,  that  it 
would  not  be  contended  that  a  literal  construction  of 
the  provisions  of  the  statute  relating  to  gifts  made 


72  THE    LAW    OF    TAXABLE    TRANSFERS. 

"  in  contemplation  of  death  "  would  be  reasonable  or 
was  intended  by  the  Legislature,  and  at  page  546  says : 
"A  man  of  middle  age,  in  full  health  and  strength,  may 
transfer  his  house  and  lot  and  other  property  to  his 
wife  for  the  purpose  of  securing  her  against  want  in 
case  of  his  death,  and  declare  such  purpose  in  the  deed 
of  conveyance.  Clearly  such  conveyance  would  be 
made  in  contemplation  of  death,  but  if  the  grantee  lived 
ten,  fifteen,  or  thirty  years  after,  the  property  would 
not  be  subject  to  the  tax,  and  this  is  so,  notwithstand- 
ing the  transaction  is  within  the  precise  words  of  the 
statute. ' ' 

"A  father  may  have  engaged  in  business  during  a 
lifetime  in  which  he  had  accumulated  and  has  invested 
a  fortune ;  he  is  becoming  old ;  less  active,  more  infirm 
and  feeble,  and  less  able  to  conduct  the  business.  He 
concludes  to  and  does  give  and  transfer  the  business  to 
a  trusted  son.  It  was  not  transferred  or  received  for 
the  purpose  of  evading  the  transfer  tax,  but  because 
the  father  wished  to  observe  the  management  of  the 
business  by  the  son  before  his  death,  and  to  be  relieved 
of  its  burden.  The  father  lives  five  or  ten  years  after 
the  transfer,  which  was  concededly  made  because  he 
understood  and  believed  that  death  was  not  far  distant. 
Under  such  circumstances  we  think  it  could 
not  be  successfully  urged  that  the  property  and  busi- 
ness transferred  were  subject  to  tax  under  the  statute 
in  question,  and  yet  such  transfer  would  fall  directly 
within  its  provisions  if  given  a  literal  interpretation. ' 7 

It  will  be  seen  therefore  that  the  question  of  whether 
a  gift  is  "  made  in  contemplation  of  death,"  so  as  to 
come  within  the  intention  of  the  statute,  can  only  be 


TKANSFERS IN    CONTEMPLATION    OF    DEATH.  73 

determined  after  a  full  consideration  of  all  the  facts 
surrounding  each  transaction. 

A  provision  in  the  statute  fixing  a  definite  time  prior 
to  death,  within  which  gifts  would  be  deemed  "  made 
in  contemplation  of  death, ' '  would  settle  all  contention 
in  respect  to  gifts  of  this  kind,  but  as  yet  the  wisdom, 
or  even  the  necessity,  of  such  a  provision  has  not  re- 
ceived the  consideration  of  the  Legislature. 

101.  Transfers  —  Made  in  Contemplation  of  Death. 

Deeds  of  real  property  executed  by  testatrix  with- 
out consideration  and  delivered  to  her  nieces  when 
the  testatrix  was  seventy-nine  years  old  and  was 
suffering  from  consumption,  from  which  she  knew 
she  would  never  recover,  are  gifts  inter  vivos  "  made 
in  contemplation  of  the  death  "  of  the  donor,  and 
the  property  transferred  is  taxable,  notwithstanding 
the  testatrix  had,  by  her  will  made  a  few  months 
previously,  constituted  the  nieces  her  residuary  lega- 
tees of  practically  the  same  property.  Matter  of 
Birdsall,  22  Misc.  Rep.  180,  49  N.  Y.  S.  450;  affd.,  43 
App.  Div.  624,  60  N.  Y.  S.  1133. 

Testator  during  his  last  illness  delivered  to  his  niece 
a  note  of  his  executor,  saying  that  he  had  given  it  to 
her,  —  that  she  was  to  keep  it  and  that  he  did  not  want 
his  heirs  to  know  about  it,  —  held  a  valid  gift  causa 
mortis  and  subject  to  tax.  Matter  of  Crosby,  46  N.  Y. 
St.  K.  442,  20  N.  Y.  S.  62. 

Where  it  is  claimed  by  the  State  that  certain  real 
property  has  been  conveyed  by  a  decedent ' '  in  contem- 
plation of  deatli  "  and  lias  not  been  taxed,  the  claim 
cannot  be  heard  unless  the  grantee  had  notice  of  the 


74  THE    LAW    OF    TAXABLE    TRANSFEES. 

proceedings  to  fix  the  tax.    Matter  of  Wood,  40  Misc. 
Rep.  155,  81  N.  Y.  S.  511. 

102.  To  What  the  Words  "  In  Contemplation  of  Death  "  Refer. 

The  words  ' '  in  contemplation  of  the  death, ' '  used  in 
the  statute,  do  not  refer  to  that  general  expectation  of 
death  which  every  mortal  entertains,  but  rather  the  ap- 
prehension which  arises  from  some  existing  condition 
of  body  or  some  impending  peril.  Matter  of  Baker,  83 
App.  Div.  530,  82  N.  Y.  S.  390 ;  aff d.,  178  N.  Y.  575. 

1 03.  Transfers,  not  Made  in  Contemplation  of  Death  of  Donor. 
A  gift  inter  vivos  is  not  a  transfer  "  made  in  con- 
templation of  the  death  of  the  grantor  "  within  the 
meaning  of  the  statute,  unless  made  under  circum- 
stances which  impress  it  with  the  distinguishing  char- 
acteristics of  a  gift  causa  mortis,  or  unless  made  with 
the  purpose  of  evading  the  provisions  of  the  statute. 
Matter  of  Spaulding,  49  App.  Div.  541,  63  N.  Y.  S.  694; 
affd.,  163  N.  Y.  607.  On  the  general  question  as  to 
what  constitutes  a  gift  inter  vivos  see  Matter  of  Sivade, 
65  App.  Div.  592,  72  N.  Y.  S.  1030. 

A  man  eighty-six  years  old,  whose  mental  faculties 
were  unimpaired,  but  whose  physical  powers  were 
gradually  deteriorating,  gave  to  a  son  securities  valued 
at  over  $1,500,000,  to  be  equally  divided  between  him- 
self and  his  brother  and  sister.  The  securities  were 
delivered  to  the  children,  and  the  father,  who  died 
about  a  year  after  making  the  gift,  never  saw  the 
securities  or  attempted  to  exercise  any  control  over 
them.  Held,  that  the  gifts  were  not ' '  made  in  contem- 
plation of  the  death  of  the  grantor, ' '  within  the  mean- 


TRANSFERS NOT  IN  CONTEMPLATION   OF   DEATH.      75 

ing  of  the  statute.  Matter  of  Spaulding,  49  App.  Div. 
541,  63  X.  Y.  S.  694;  affd.,  163  N.  Y.  607. 

The  president  of  a  corporation,  being  ill,  and  advised 
by  his  physician  to  take  a  long  vacation  when  he  recov- 
ered, transferred  all  his  stock  in  such  corporation  to 
his  wife,  excepting  one  share,  and  the  wife  became  a 
member  of  the  company  at  once  and  transacted  busi- 
ness in  his  place.  The  transfer  of  the  stock  was  in 
writing  and  absolute,  and  on  the  same  day  that  he 
executed  the  transfer  of  the  stock  he  made  his  will, 
leaving  his  wife  his  sole  beneficiary,  and  three  weeks 
thereafter  he  died.  Held,  that  these  facts  did  not  jus- 
tify a  finding  that  the  transfer  of  the  stock  was  made 
in  contemplation  of  death  of  the  donor."  Matter  of 
Mahlstedt,  67  App.  Div.  176,  73  N.  Y.  S.  818;  appeal 
dismissed,  171  N.  Y.  652. 

Gift  of  shares  of  stock  of  a  bank  of  which  the  donor 
is  president,  and  also  stock  in  a  pulp  company  of  which 
the  donor  is  a  director,  by  assignments  written  on  the 
backs  of  the  stock  certificates,  which  are  thereupon 
delivered  to  the  donees,  who  retain  possession  of  them 
until  the  donor's  death,  held  gifts  inter  vivos,  and  not 
subject  to  a  transfer  tax  on  the  ground  that  they  were 
made  in  contemplation  of  the  donor's  death,  it  appear- 
ing that  the  donor  was  eighty-six  years  old  when  he 
died,  and  that  the  stock  certificates  were  transferred 
over  three  years  prior  to  his  death.  The  court  held 
further  that  such  gifts  are  not  subject  to  a  transfer 
tax  where  it  does  not  appear  that  they  were  made  in 
bad  faith  or  with  intent  to  evade  the  transfer  tax,  or 
that  they  were  accompanied  by  a  trust  or  enforceable 


76  THE   LAW    OF    TAXABLE   TRANSFERS. 

reversion  under  which  the  dividends  upon  the  stock 
were  to  be  paid  to  the  donor  during  life. 

The  fact  that  the  donor  during  life  did  receive  the 
dividends  upon  the  stock  transferred  is  not  of  itself 
sufficient  to  establish  the  existence  of  a  valid  trust  or 
reservation  in  respect  to  the  dividends,  the  court  hold- 
ing that  such  acts  could  as  well  be  predicated  upon  the 
voluntary  sufferance  of  the  donees  as  upon  a  prior 
contract.  Matter  of  Bullard,  76  App.  Div.  207,  78 
N.  Y.  S.  491. 

Where  less  than  two  months  prior  to  a  decedent's 
death  he  transferred  to  his  five  children  stocks  and  se- 
curities aggregating  $250,000,  held,  that  such  transfer 
was  not  made  in  contemplation  of  death,  it  appearing 
that  he  had  for  a  year  or  more  prior  to  his  death  con- 
templated making  such  transfers,  although  at  the  time 
the  transfers  were  made  he  was  an  old  man  and  in  poor 
health.  Matter  of  Crary,  31  Misc.  Rep.  72,  64  N.  Y.  S. 
566. 

Transfers  of  stocks  made  in  consideration  of  an 
agreement  conditioned  for  the  payment  of  an  annuity 
to  the  party  making  the  transfer,  and  to  other  desig- 
nated persons,  with  a  proviso  that,  in  case  of  default 
in  payment  of  the  annuities,  the  depositary  might  col- 
lect sufficient  dividends  on  the  securities  to  pay  the 
amount  due,  or  sell  them  to  raise  such  amount,  are 
not  subject  to  taxation  under  chapter  399,  Laws  1892, 
as  having  been  made  in  contemplation  of  the  death 
of  the  party  making  such  transfer.  Matter  of  Edger- 
ton,  35  App.  Div.  125,  54  N.  Y.  S.  700. 


TKANSFEES TAKING  EFFECT  AT  DONOR  S  DEATH.       /  t 

1 04.  Transfers  Taking  Effect  "  at  or  after  the  Donor's  Death." 

When  property  is  delivered  by  the  owner  to  a  trus- 
tee, under  an  instrument  purporting  to  assign  it  to 
the  trustee  and  his  successors  in  trust,  to  collect  the 
income  and  apply  the  same  to  the  grantor's  use  dur- 
ing life,  and  after  the  grantor's  death  to  distribute 
the  property  among  designated  remaindermen,  the 
transfer  to  the  remaindermen  must  be  deemed  to  have 
been  "  intended  to  take  effect  in  possession  or  enjoy- 
ment, at  or  after  the  death  "  of  the  grantor  or  donor, 
and  is  taxable.     Matter  of  Greene,  153  X.  Y.  223. 

It  matters  not  whether  the  transfer  is  by  grant  or  by 
gift,  so  long  as  it  was  intended  to  take  effect  in  posses- 
sion or  enjoyment  at  or  after  the  death  of  the  grantor 
or  donor,  the  devolution  of  title  is  subject  to  the  tax. 
Matter  of  Greene,  153  N.  Y.  223-228. 

1 05.  When  a  Trust  Deed  Does  not  Constitute  an  Absolute  Gift. 

A  trust  deed  did  not  constitute  an  absolute  gift  of 
the  grantor's  property  during  his  life,  so  as  to  exempt 
the  transfer  from  tax  under  the  Taxable  Transfer  Act 
of  1892  (chap.  399),  as  a  gift  intended  to  take  effect  at 
or  after  the  grantor's  death,  where,  after  the  delivery 
of  the  deed  to  the  trustee,  the  grantor  not  only  was 
entitled  at  any  time  to  revest  himself  with  the  owner- 
ship of  the  property,  but  he  continued  to  be  able  to 
enjoy  it  or  to  manage  and  dispose  of  it  as  effectually 
as  he  might  previously  have  done,  by  reserving  to 
himself  power  to  alter  or  amend  the  trust  by  notice  to 
the  trustee,  to  withdraw  or  exchange  securities,  and  to 
control  the  acts  of  the  trustee  in  selling  or  disposing 


/8  THE    LAW    OF    TAXABLE    TRANSFERS. 

of  the  securities,  with  respect  to  investments.  Matter 
of  Bostwick,  160  N.  Y.  489. 

In  the  Matter  of  Skinner,  45  Misc.  Rep.  559,  92 
N.  Y.  S.  972,  it  appeared  that  the  decedent,  a  resident 
of  Westchester  county,  several  months  before  his  death, 
in  1901,  made  and  executed  a  trust  deed  conveying  to 
his  friend  Langley  all  of  his  property,  real  and  per- 
sonal, in  consideration  of  the  sum  of  $1,  and  the  fur- 
ther consideration  of  services  rendered  and  to  be  there- 
after rendered  by  such  friend,  to  have  and  to  hold  the 
same  in  trust,  nevertheless,  for  the  use  of  the  grantor 
during  his  natural  life,  and  at  his  death  to  become 
the  property  of  the  friend  absolutely.  Appended  to 
this  trust  deed  was  a  duly  executed  and  acknowledged 
acceptance  of  the  trust  by  the  friend,  and  a  further 
recital  that  the  grantor  could  have  and  use  at  any 
time  during  his  life  any  part  or  portion  of  the  proper- 
ties mentioned  therein,  and  that  the  friend  would  exe- 
cute any  instruments  that  might  be  necessary  to  carry 
into  effect  the  understanding  and  agreement  of  the  par- 
ties thereto.  In  transfer  tax  proceedings  the  dece- 
dent's net  estate  was  found  to  be  $105,527.73,  and  on 
May  14,  1904,  an  order  was  entered  assessing  a  tax 
upon  the  transfer  thereof  to  the  friend  Langley  at  5 
per  cent.  An  appeal  was  taken  by  Langley  upon  vari- 
ous grounds,  one  of  which  was  that  the  order  assessing 
the  tax  was  erroneous  in  that  the  transfer  was  not 
made  in  contemplation  of  death  or  intended  to  take 
effect  at  or  after  the  death  of  the  decedent,  and  there- 
fore is  not  subject  to  any  tax  whatever. 

The  surrogate  held  that  it  was  never  intended  that 


TRANSFERS TAKING  EFFECT  AT  DONOR 's  DEATH.   79 

he  (Langley)  should  become  the  absolute  owner  of 
this  property  until  at  or  after  the  death  of  the  grantor, 
and  that  the  transfer  tax  has  been  properly  assessed. 
Citing  Matter  of  Cornell,  170  N.  Y.  423;  Matter  of 
Brandreth,  169  N.  Y.  437. 

The  Appellate  Division  of  the  Second  Department 
affirmed  the  order  of  the  surrogate  so  far  as  it  imposed 
a  tax  upon  the  property  transferred  by  the  decedent 
under  the  trust  deed  to  Langley,  but  modified  the  order 
in  other  respects.    Matter  of  Skinner,  106  App.  Div. 

One  of  four  certain  trust  deeds  provides  that  the 
avails  shall  go  to  the  donor  during  his  lifetime,  and 
from  and  after  his  death  the  avails  were  to  go  to  the 
donor's  grandson.  Held,  that  such  deed  did  not  vest 
the  beneficiary  named  with  any  right  of  property  until 
the  death  of  the  donor,  at  which  time  it  became  tax- 
able. Matter  of  Masury,  28  App.  Div.  580,  51  N.  Y.  S. 
331;  affd.,  159  N.  Y.  532. 

A  father  executed  a  trust  deed  in  1892,  transferring 
certain  personal  property  to  trustees,  to  invest  the 
principal  and,  from  the  net  income,  to  pay  during  his 
life  to  his  daughter  the  sum  of  $1,200  annually,  the  bal- 
ance of  such  income,  if  any,  to  be  returned  to  himself, 
and  at  his  death  to  pay  over  the  corpus  of  the  trust 
fund  to  said  daughter,  if  living,  or,  if  she  should  be 
dead,  then  to  her  issue,  or,  in  default  of  issue,  then 
to  such  persons  as  the  daughter  should  by  her  will 
appoint,  or,  in  default  of  such  appointment,  then  to 
such  persons  as  would  be  entitled  to  the  property  if 
the  daughter  had  died  intestate  and  in  possession  of 


80  THE    LAW    OF    TAXABLE   TRANSFERS. 

the  property,  excepting  her  mother,  who  released  her 
right  of  succession  thereto.  The  daughter  died  in 
September,  1896,  unmarried,  without  issue  and  with- 
out making  any  appointment.  The  father  died  in 
April,  1898.  Held,  that,  as  the  contingent  remainders 
given  to  the  next  of  kin  of  the  daughter  could  not 
take  effect  in  possession  or  enjoyment  until  the  father's 
death,  the  transfer  to  them  was  taxable  under  sub- 
division 3  of  section  220,  as  a  gift  taking  effect  at  or 
after  the  donor's  death.  Matter  of  Cruger,  54  App. 
Div.  405,  66  N.  Y.  S.  636;  affd.,  166  N.  Y.  602,  citing 
Matter  of  Greene,  153  N.  Y.  223. 

1 06.  Gift  Where  Donee  only  Survived  the  Donor  Three  Days. 

A  gift  intended  to  take  effect  in  possession  or  enjoy- 
ment at  the  death  of  the  donor  is  taxable,  although  the 
donee  survived  the  donor  for  only  three  days,  having 
died  before  there  had  been  any  administration  upon 
the  donor's  estate,  and  before  actual  delivery  of  the 
certificate  representing  the  subject  of  the  gift  had 
been  made  to  the  donee.  The  transfer  from  the  donor 
to  the  donee  is  taxable;  also  the  transfer  of  the  sub- 
ject of  the  gift  from  the  donee  to  her  legatee  is  taxable. 
Matter  of  Borup,  28  Misc.  Rep.  474,  59  N.  Y.  S.  1097. 

107.  Gifts  upon  Conditions  or  Agreement. 

A  gift  of  corporate  stock  upon  conditions  that  all 
dividends  declared  upon  it  for  the  term  of  his  life 
should  be  received  by  the  owner,  and  that  he  should 
have  the  right  to  vote  upon  it  the  same  as  though  no 
transfer  had  been  made,  is  a  gift  of  a  remainder  in 


TRANSFERS  —  TAKING  EFFECT  AT  DONOR 's  DEATH.   81 

the  stock  after  the  death  of  the  donor,  and  is  taxable. 
Matter  of  Brandreth,  169  N.  Y.  437,  revg.  same  case, 
58  App.  Div.  575,  69  N.  Y.  S.  142. 

A  gift  of  securities  under  an  agreement  that  the 
donor  should  have  during  his  life  "  all  or  such  part 
of  the  net  income  thereof  as  he  might  wish, ' '  the  donee 
to  have  the  possession  and  management  of  the  securi- 
ties, does  not  make  the  donee  the  absolute  owner 
thereof,  but  only  the  holder  thereof  in  trust,  until  the 
death  of  the  donor,  to  pay  the  income  thereof  to  the 
donor,  and  such  gift  is  taxable.  Matter  of  Cornell,  170 
X.  Y.  423,  following  Matter  of  Brandreth,  169  N.  Y. 
437;  modifying  Matter  of  Cornell,  66  App.  Div.  162, 
73  X.  Y.  S.  32. 

Where  the  title  to  personal  property  passed  to  the 
donee  upon  its  delivery  by  the  donor,  but  the  gift  was 
subject  to  revocation  at  all  times  during  the  lifetime 
of  the  donor,  it  took  effect  in  enjoyment  after  the  death 
of  the  donor  and  was  taxable.  Matter  of  Edwards,  85 
Hun,  436,  32  N.  Y.  S.  901;  affd.,  146  X.  Y.  380,  no 
opinion. 

Where  a  testator,  after  making  a  will  in  favor  of 
his  wife  and  children,  conveys  his  property  in  trust 
for  the  maintenance  of  himself  and  family,  with  direc- 
tion that  at  his  death  it  be  disposed  of  according  to 
the  terms  of  his  will,  the  property  is  taxable.  Matter 
of  Johnson,  47  X.  Y.  St.  R,  391,  19  X.  Y.  S.  963. 

Where  a  testator,  after  placing  unrecorded  deeds 
executed  by  him,  and  securities  assigned  by  him,  in 
envelopes  inscribed  as  the  "  property  "  of  the  pro- 
posed transferees,  and  after  placing  the  envelopes  in 
6 


82  THE    LAW    OF    TAXABLE    TRANSFERS. 

a  box  in  a  bank,  labeled  with  his  name  and  that  of  a 
transferee,  continues  to  control  the  real  estate  and  re- 
ceive the  income  of  the  securities,  the  property  is  sub- 
ject to  the  transfer  tax.  Matter  of  Sharer,  36  Misc. 
Rep.  502,  73  N.  Y.  S.  1057. 

A  husband  in  his  lifetime  transferred  from  time  to 
time  to  his  wife's  name  certain  firm  profits,  which  he 
had  invested  with  his  firm  in  a  special  account,  stating 
as  a  reason  therefor  that,  in  case  of  any  trouble  in 
the  concern,  he  would  have  something  for  his  wife  and 
children  which  the  creditors  could  not  touch.  The 
wife  dies  before  the  husband,  and  the  property  was 
held  subject  to  the  transfer  tax,  although  all  the  chil- 
dren signed  an  instrument  permitting  the  husband  to 
treat  the  money  as  his  own.  Matter  of  Anthony,  40 
Misc.  Rep.  497,  82  N.  Y.  S.  789. 

108.  Transfers  not  Made  to  Take  Effect  at  or  After  Donor's 
Death. 

In  the  Matter  of  Craig,  97  App.  Div.  289,  89  N.  Y.  S. 
971 ;  affd.,  181  N.  Y.  Mem.,  it  appears  that  on  Novem- 
ber 20,  1875,  Hector  Craig  executed  a  deed  of  all  his 
property,  real  and  personal,  to  Havemeyer  and  Lane, 
trustees,  providing  for  the  payment  to  himself  of  all 
the  income  during  his  life.  The  deed  was  made  in 
anticipation  of  the  marriage  of  Craig  with  Mary  W. 
Darrach,  the  deed  reciting  that  the  said  Craig  "  is 
desirous  of  making  provision  out  of  his  estate  for  the 
said  Mary  W.  Darrach  in  case  said  marriage  takes 
place,  and  the  said  party  of  the  first  part  (Craig) 
thereafter  departs  this  life  leaving  her  his  widow  him 


TRANSFERS TAKING  EFFECT  PRIOR  TO  DONOR 's  DEATH.  83 

surviving/'  and  making  other  provisions  as  to  his 
estate. 

Conditions:  (1)  If  widow  survives  him  and  be  at 
the  time  of  his  death  his  lawful  wife,  and  not  sepa- 
rated from  him  by  mutual  agreement  or  judicial  decree, 
and  no  issue  of  such  marriage  in  being  at  the  time  of 
his  death,  then  the  widow  to  have  one-half  of  his  prop- 
erty and  remainder  to  certain  sisters  and  collateral 
relatives. 

(2)  If  wife  dies  before  Craig,  or  is  separated  or  di- 
vorced from  him  and  no  children  living,  then  property 
is  to  go  to  certain  charitable  institutions. 

(3)  If  Craig  dies  leaving  lawful  issue  of  such  mar- 
riage, or  of  any  subsequent  marriage,  living  at  his  de- 
cease, then  one-third  to  children,  one-third  to  widow 
him  surviving,  and  one-third  to  certain  legatees  and 
societies. 

Appended  to  this  deed  is  a  statement  that  she  (Dar- 
rach)  accepts  the  provisions  "  in  lieu  of  her  dower 
and  distributive  share  to  which  she  might  otherwise  be 
entitled  by  reason  of  her  marriage  to  Craig." 

All  the  beneficiaries  under  this  deed,  excepting  the 
Craig  family,  released  to  Craig  prior  to  May  9,  1885, 
all  their  interest  under  said  trust  deed,  and  on  May  9, 
1885,  a  decree  was  entered  in  Supreme  Court  permit- 
ting the  said  Havemeyer,  the  surviving  trustee,  to 
resign  his  trust,  and  the  New  York  Life  Insurance  & 
Trust  Company  was  appointed  trustee  and  charged 
in  the  decree  with  carrying  out  the  provisions  of  the 
trust  deed,  except  that  Craig  was  to  dispose  by  will 
of  the  interests  released  to  him  by  the  beneficiaries 


84  THE    LAW    OF    TAXABLE    TRANSFERS. 

above  referred  to.  This  trust  continued  until  the 
death  of  Craig,  March  27,  1901,  leaving  his  wife  and 
two  children  surviving.  Craig  left  a  will  giving  his 
wife  all  that  part  of  his  estate  which  he  had  the  right 
to  dispose  of,  in  addition  to  what  she  would  receive 
under  the  trust  deed. 

November  26,  1901,  the  surrogate  of  Orange  county 
made  an  order  fixing  tax,  holding  that  the  gift  under 
the  trust  deed  was  intended  to  take  effect  in  possession 
and  enjoyment  at  or  after  death  (subd.  3,  §  220,  Tax 
Law),  and  taxable.  The  widow  and  children  appeal 
to  surrogate  on  the  ground  that  they  took  a  vested 
interest  under  the  trust  deed  at  the  time  the  deed  was 
executed,  in  1875,  and  therefore  the  transfer  in  pos- 
session and  enjoyment  upon  the  death  of  Craig  is 
not  taxable.  The  surrogate  affirms  his  order  of  No- 
vember 26,  1901,  and  appeal  is  taken  to  the  Appellate 
Division. 

The  Appellate  Division  reverses  the  order  of  the 
surrogate  and  dismisses  the  proceedings,  holding  that 
the  interests  of  the  appellants  are  to  be  regarded  as 
accruing  under  the  trust  deed,  —  that  it  is  immaterial 
whether  they  are  vested  or  contingent,  or  whether  the 
trust  deed  is  a  gift  inter  vivos  or  causa  mortis,  —  that 
the  right  as  a  property  right  to  take  the  gifts  when  the 
time  for  possession  and  beneficial  enjoyment  should 
ultimately  arrive,  fully  accrued  at  the  date  of  the  mar- 
riage and  birth  of  the  children,  free  from  any  existing 
tax  upon  the  transfer  either  made  or  contemplated,  and 
that  subsequent  legislation  imposing  a  tax  is  unconsti- 
tutional (In  re  Pell,  171  N.  Y.  48);  that  the  word 
"  vested,"  as  used  in  many  of  the  opinions  of  this 


TRANSFERS TAKING  EFFECT  PRIOR  TO  DONOR 's  DEATH.  85 

court,  is  really  to  be  construed  as  equivalent  to  the 
word  "  accrued,"  and  not  as  distinguished  from  merely 
contingent  interests.  In  that  sense  a  property  right 
which  has  been  fully  acquired  is  protected  by  the  con- 
tract and  becomes  in  law  a  vested  right.  Matter  of 
Vanderbilt,  172  N.  Y.  69,  73. 

Matter  of  Green,  153  N.  Y.  223;  Matter  of  Brandreth, 
169  N.  Y.  437;  Matter  of  Cornell,  170  N.  Y.  423,  are  all 
cases  where  the  will  or  deed  was  either  executed  or  took 
effect  after  the  laws  imposing  a  tax  on  inheritances  or 
transfers.  Matter  of  Seaman,  147  N.  Y.  69,  distin- 
guished. 

A  grantor  made  certain  deeds  of  trust  in  favor  of 
his  son,  providing  in  each  for  the  payment  of  the  in- 
come of  the  trust  to  the  beneficiary's  guardian  during 
such  beneficiary's  minority,  and  upon  the  beneficiary 
becoming  of  age  the  trustee  was  to  pay  over  the  securi- 
ties constituting  the  fund  and  any  unexpended  income 
to  said  beneficiary;  the  deeds  contained,  however,  a 
clause  reserving  the  right  of  the  grantor  "  to  revoke 
and  annul  the  same  during  my  lifetime,"  —  held  not 
taxable  as  a  gift  intended  to  take  effect  after  the 
donor's  death,  as  such  deeds  divested  the  grantor  of 
all  title  and  become  operative  immediately  upon  their 
execution,  in  so  far  as  the  beneficial  use  of  the  same 
was  involved,  and  vesting  the  fund  upon  given  dates, 
in  no  wise  contingent  upon  the  death  of  the  grantor, 
in  the  beneficiaries.  Matter  of  Masury,  28  App.  Div. 
580-588,  51  N.  Y.  S.  331 ;  affd.,  159  N.  Y.  532.* 

*In  the  Matter  of  Bostwick,  160  N.  Y.  489,  the  court  says:  "I 
think  we  may  have  gone  too  far  in  generally  affirming  the  Masury 
decision ;  certainly  the  limit  was  then  reached  beyond  which  the  courts 
could  not  go  without  emasculating  the  provisions  of  the  statute." 


86  THE    LAW    OF    TAXABLE    TRANSFERS. 

Stocks  transferred  under  an  agreement,  evidenced 
by  bonds  executed  by  the  transferees,  conditioned  for 
the  payment  of  an  annuity  to  the  party  making  the 
transfer  and  to  other  designated  persons,  and  for  the 
deposit  of  the  securities  as  collateral  security  for  the 
performance  thereof,  with  a  provision  that  in  default 
of  the  payment  of  the  annuities  the  depository  might 
collect  sufficient  dividends  on  the  securities  to  pay  the 
amount  due,  or  sell  them  to  the  extent  necessary  to 
raise  such  amount;  held,  a  gift  inter  vivos  and  not  tax- 
able. Matter  of  Edgerton,  35  App.  Div.  125,  54  N.  Y. 
S.  700;affd.,  158  N.  Y.  671. 

109.  Vested  Interests  Although  Will  Contains  no  Words  of 
Present  Gift. 

A  testator  in  1884  died  leaving  a  will,  wherein  he 
devised  and  bequeathed  his  entire  estate  to  his  execu- 
trix in  trust  for  the  support  of  his  widow  until  her 
death  or  remarriage.  After  the  death  or  remarriage 
of  the  widow,  certain  legacies  should  be  paid,  and  in 
the  event  of  the  death  of  any  of  the  legatees  the  lega- 
cies "  to  go  to  the  heirs  of  the  person  so  dying,"  or 
"to  go  to  his  heirs  and  assigns."  That  after  the 
death  or  remarriage  of  his  wife,  and  the  payment  of 
the  legacies,  one-third  of  the  estate  "  shall  go  to  and 
belong  to  "  his  niece,  "  her  heirs  and  assigns  for- 
ever;" another  one-third  should  go  to  his  wife's 
nephew,  "  his  heirs  and  assigns  forever,"  and  the 
remaining  third  should  be  divided  into  five  parts  and 
given  to  or  held  in  trust  for  certain  persons.  In  dis- 
posing of  said  five  parts  of  the  remaining  third,  the 


TRANSFERS TAKING  EFFECT  PRIOR  TO  DONOR  S  DEATH.  0/ 

decedent  used  the  expressions  "  shall  belong  to  "  and 
"  shall  go  and  belong  to."  The  widow  died  in  1902, 
without  having  remarried,  and  the  Comptroller  con- 
tended that  the  legacies  did  not  vest  at  the  death  of 
the  testator,  but  the  will  created  future  gifts,  which 
were  not  transferred  until  the  death  of  the  widow. 

The  court  held  that  the  words  "go  to  and  belong 
to,"  as  used  in  the  will,  should  not  be  construed  to 
mean  "  pay  and  divide,"  thus  permitting  the  applica- 
tion of  the  rule  that,  where  the  only  words  of  gift  are 
found  in  the  direction  to  pay  and  divide  at  a  future 
time,  the  gift  is  future  not  immediate,  contingent  and 
not  vested;  that  the  legacies  bequeathed  by  the  will 
vested  at  the  testator's  death,  and  not  at  the  death  of 
the  widow;  that  the  transfer  tax  is  upon  the  transfer 
of  the  property  itself,  and  "  transfer  "  means  the 
passing  of  property  in  possession  or  enjoyment,  pres- 
ent or  future,  without  regard  to  whether  the  actual 
possession  and  enjoyment  follow  immediately  or  come 
at  some  future  time,  and  therefore,  as  the  interests 
vested  under  the  decedent's  will  prior  to  the  Transfer 
Tax  Law,  such  transfers  were  not  taxable.  Matter  of 
Hitchins,  43  Misc.  Rep.  485,  89  N.  Y.  S.  472;  affd.,103 
App.  Div.  ,  without  opinion ;  afrcl.,  181  N.  Y.  Mem. 
553,  no  opinion. 

11 0.  Gift  —  Agreement  to  Care  for   Donor  for  Life. 

An  agreement  by  a  donee  of  property  to  care  for 
the  person  making  the  transfers  during  his  lifetime, 
and  supply  him  with  money  as  he  needed  it,  does  not, 
in  the  absence  of  affirmative  proof  that  the  donor  re- 


88  THE    LAW    OF    TAXABLE   TRANSFERS. 

served  to  himself  the  beneficial  use  and  enjoyment  of 
the  property  during  his  life,  limit  the  absolute  charac- 
ter of  the  transfer,  or  render  it  taxable  at  the  donor's 
death  as  a  gift  made  to  take  effect  at  or  after  the 
donor's  death.  Matter  of  Thome,  44  App.  Div.  8,  60 
N.  Y.  S.  419;  appeal  dismissed,  162  N.  Y.  238. 


CHAPTER  VI. 


Taxable  Transfers  —  Power  of  Appointment. 

(§  220,  Tax  Law.) 


111.  Effect  of  general  power  of  ap- 

pointment. 

112.  Transfers,     by     the      exercise 

of. 

113.  Object    and    purpose    of    the 

statute. 

114.  Powers  created  by  will. 

115.  Powers  created  by  deed. 
115a.  Appointee  can  elect  to  take 

under  the  exercise  of  the 
power,  or  under  the  former 
will  or  deed. 

116.  Time  of  payment  is  when  the 

power  of  appointment  is  ex- 
ercised. 

117.  Erroneous  payment  cannot  be 

considered  a  payment  made 
"  in  advance." 

118.  When  the  power  is  deemed  to 

have  been  exercised. 


119.  Taxability  of  transfers  where 

funds  over  which  power  is 
exercised  are  without  this 
State. 

120.  When  remaindermen  not  bound 

by  acts  of  life  tenant;  fail- 
ing to  exercise  power. 

121.  When  tax  on  transfers  under 

a  power  will  be  paid  from 
the  donee's  residuary  estate. 

122.  Failure     to     exercise     power; 

equitable    conversion. 

123.  When  grantee,  with  power  to 

dispose,  is  entitled  to  an 
absolute  fee. 

124.  Decisions    affecting    transfers 

upon  the  exercise  of  power 
of  appointment. 

125.  Decisions  prior  to  the  amend- 

ment of  1897. 


111.  Effect  of  General  Power  of  Appointment. 

The  effect  of  conferring  a  general  power  of  appoint- 
ment is  to  invest  its  donee  with  a  power  of  disposition 
as  broad  as  though  she  was  disposing  of  her  own  prop- 
erty. In  its  exercise  she,  in  fact,  makes  the  gift  or 
bequest  to  persons  of  her  own  selection.  Isham  v. 
iV.  Y.  Assn.  for  Poor,  111  N.  Y.  218. 

Under  the  Real  Property  Law,  "  a  power  is  an  au- 
thority to  do  an  act  in  relation  to  real  property,  or  to 
the  creation  or  revocation  of  an  estate  therein,  or  a 
charge  thereon,  which  the  owner,  granting  or  reserv- 
es] 


90  THE    LAW    OF    TAXABLE    TRANSFERS. 

ing    the   power,    might    himself    lawfully    perform." 
(Laws  of  1896,  chap.  547,  §  111.) 

This  provision  applies  also  to  powers  concerning 
personal  property.  Matter  of  Moehring,  154  N.  Y. 
423-427;  Matter  of  Cooksey,  182  N.  Y.  92. 

112.  Transfers,  by  the  Exercise  of. 

Subdivision  5  of  section  220,  Tax  Law,  provides 
that  — 

Whenever  any  person  or  corporation  shall  exercise  a  power 
of  appointment  derived  from  any  disposition  of  property 
made  either  before  or  a'fter  the  passage  of  this  act,  such  ap- 
pointment when  made  shall  be  deemed  a  transfer  taxable 
under  the  provisions  of  this  act  in  the  same  manner  as 
though  the  property  to  which  such  appointment  relates  be- 
longed absolutely  to  the  donee  of  such  power  and  had  been 
bequeathed  or  devised  by  such  donee  by  will ;  and  whenever 
any  person  or  corporation  possessing  such  a  power  of  appoint- 
ment so  derived  shall  omit  or  fail  to  exercise  the  same  within 
the  time  provided  therefor,  in  whole  or  in  part,  a  transfer 
taxable  under  the  provisions  of  this  act  shall  be  deemed  to 
take  place  to  the  extent  of  such  omissions  or  failure,  in  the 
same  manner  as  though  the  persons  or  corporations  thereby 
becoming  entitled  to  the  possession  or  enjoyment  of  the  prop- 
erty to  which  such  power  related  had  succeeded  thereto  by  a 
will  of  the  donee  of  the  power  failing  to  exercise  such  power, 
taking  effect  at  the  time  of  such  omission  or  failure. 

This  provision  first  appeared  in  the  Transfer  Tax 
Law  April  16,  1897  (chap.  284,  Laws  1897,  amending 
§220). 

113.  Object  and  Purpose  of  the  Statute. 

The  object  and  purpose  of  this  amendment  was  to 
make  the  transfer  in  possession  arising  from  the  exer- 


POWER    OF    APPOINTMENT.  91 

cise  of  the  power  the  taxable  transfer,  and  the  rate  of 
tax  to  depend  upon  the  relationship  of  the  donee  of 
the  power  to  the  appointee  under  his  will,  the  courts 
having  previously  held  the  transfer  by  the  exercise 
of  the  power  of  appointment,  where  the  power  was 
created  by  a  will  which  took  effect  before  the  enact- 
ment of  any  collateral  inheritance  or  transfer  tax  law, 
was  not  taxable  upon  the  exercise  of  such  power,  since 
the  source  of  the  title  is  the  will  creating  the  power, 
into  which  the  names  of  the  appointees  must  be  read, 
and  their  rights  to  succession  did  not  vest  at  the  time 
of  the  execution  of  the  power,  but  at  the  time  the  will 
creating  the  power  went  into  effect.  Matter  of  Ear- 
beck,  161  N.  Y.  211,  revg.  43  App.  Div.  188. 

1 1 4.  Powers  Created  by  Will. 

This  amendment  of  1897  first  came  up  for  construc- 
tion in  the  Matter  of  Vanderbilt,  50  App.  Div.  246,  63 
N.  Y.  S.  1079;  affd.,  163  N.  Y.  597,  on  the  opinion 
below : 

The  court  held  that  the  taxing  of  property  trans- 
ferred under  a  power  of  appointment  pursuant  to  sub- 
division 5  of  section  220  is  constitutional,  and  property 
so  transferred  subsequent  to  the  enactment  of  the  stat- 
ute is  subject  to  a  transfer  tax  as  of  the  date  of  the 
transfer,  although  at  the  time  of  the  creation  of  the 
power  there  was  no  law  in  force  taxing  such  transfers. 
The  execution  of  the  power  does  not  relate  back  to  the 
will  of  the  testator  creating  it  so  as  to  make  every  in- 
terest affected  by  its  exercise  subject  to  the  law  in 
force  at  the  time  of  the  death  of  such  testator,  but  the 


92  THE    LAW    OF    TAXABLE    TRANSFERS. 

act  constituting  the  transfer  is  declared  to  be  the  exer- 
cise of  the  power  of  appointment.  William  H.  Vander- 
bilt  died  in  1885,  before  the  existence  of  any  law  taxing 
direct  inheritances.  By  his  will  he  established  a  trust 
fund  in  favor  of  his  son  Cornelius,  with  direction  that 
upon  the  son's  death  the  fund  should  go  to  the  son's 
issue  in  such  proportions  as  his  said  son  might  by  his 
will  direct,  with  a  disposition  over  if  the  son  failed  to 
exercise  the  power.  The  son  died  in  1899,  and  by  his 
will  exercised  the  power.  In  transfer  tax  proceedings 
upon  the  son's  estate  it  was  contended  that  the  exer- 
cise of  the  power  by  the  son  related  back  to  the 
father's  will,  and  that  therefore  the  interest  affected 
by  the  exercise  of  the  power  was  to  be  considered  as 
coming  under  the  father's  estate  and  should  be  con- 
trolled by  the  law  in  force  at  the  father's  death  in 
1885,  and  that,  as  no  right  of  inheritance  came  into 
existence  by  the  exercise  of  the  power,  there  was  noth- 
ing in  respect  to  the  fund  in  question  upon  which  the 
amendment  of  1897  could  operate.  It  was  also  con- 
tended that  the  amendment  impaired  the  obligations 
of  a  contract  and  interfered  with  vested  rights.  The 
Court  of  Appeals  held  that  no  contract  relation  was 
established  by  the  Act  of  1885;  *  *  *  "  that  if 
the  right  of  succession  to  this  fund  was  taxable,  as 
we  think  it  was,  the  Legislature  had  the  power  to  de- 
clare that  the  tax  should  be  imposed  as  of  the  time  at 
which  the  right  to  possession  of  the  amount  appointed 
of  the  fund  to  each  remainderman  became  fixed  and 
determined  by  the  exercise  of  the  power  of  appoint- 
ment. While  the  appointees  take  by  relation  back  so 
as  to  derive  their  title  under  William  H.  Vanderbilt's 


POWER    OF    APPOINTMENT.  93 

will,  they  must  take  their  specific  shares  in  designated 
amounts  from  the  time  of  the  execution  of  the  power, 
and  we  think  that  the  authority  of  the  State  to  impose 
a  tax  on  the  right  of  succession  continued  until  the 
time  at  which  the  extent  of  that  right  was  finally  fixed 
by  the  exercise  of  the  power  of  appointment." 

A  somewhat  different  question  involving  the  con- 
struction of  this  section  arose  in  the  Matter  of  Dows, 
167  N.  Y.  227.  David  Dows,  Sr.,  died  in  1890,  giving 
his  son  a  power  of  appointment.  David  Dows,  Jr., 
died  in  1899,  leaving  a  will  in  which  he  exercised  this 
power  in  favor  of  his  three  sons.  It  was  contended 
that  the  tax  imposed  under  the  amendment  of  1897 
was  a  property  tax,  and  not  a  succession  tax,  and 
therefore  so  much  of  the  fund  disposed  of  by  the 
power  as  was  invested  in  incorporated  companies  lia- 
ble to  tax  on  their  own  capital,  and  in  certain  State 
and  city  bonds  exempt  from  taxation  by  statute,  was 
not  subject  to  transfer  tax.  It  was  also  contended 
that  so  much  of  the  property  as  was  real  at  the  death 
of  the  donor  of  the  power,  but  was  personal  at  the 
time  the  power  was  exercised  (the  trustees  having 
power  of  sale  under  donor's  will),  was  not  subject  to 
tax,  as  the  form  in  which  the  property  was  at  the 
time  the  power  was  created  should  govern. 

The  Court  of  Appeals  held  adversely  to  both  these 
contentions,  holding  that  it  is  the  execution  of  the 
power,  and  not  the  creation  of  the  power,  that  gives 
the  grantee  the  property  passing  under  it.  This  case 
went  to  the  United  States  Supreme  Court  (Orr  v.  Gil- 
man,  183  U.  S.  278),  and  the  decision  was  sustained 
by  that  court. 


94  THE    LAW    OF    TAXABLE    TKANSFERS. 

115.  Powers  Created  by  Deed. 

The  Vanderbilt  and  Dows  decisions  covered  the  ques- 
tion of  the  exercise  of  a  power  created  by  will. 

It  was  not  until  1903  that  a  construction  of  the 
amendment  of  1897,  taxing  the  exercise  of  powers 
created  by  deed  executed  and  delivered  before  the  ex- 
istence of  a  transfer  tax  law,  was  had.  Matter  of 
Delano,  176  N.  Y.  486. 

In  1848  and  1849  William  B.  Astor  executed  two 
trust  deeds  in  favor  of  his  daughter,  Laura  Astor  De- 
lano, giving  her  power  to  dispose  of  the  property 
covered  by  said  deeds  by  her  will. 

The  daughter  died  in  1902,  exercising  the  power  in 
favor  of  a  nephew,  who  would  have  taken  a  certain  in- 
terest under  the  trust  deeds  if  she  had  failed  to  exer- 
cise the  power.  In  proceedings  to  fix  the  tax  on  the 
daughter's  estate  it  was  contended  that  the  surrogate 
had  no  jurisdiction  over  the  property  in  question,  as 
it  had  already  passed  under  the  deeds  of  1848  and 
1849,  and  therefore  did  not  pass  under  the  daughter's 
will. 

The  Appellate  Division,  without  going  into  the  ques- 
tion of  jurisdiction,  held  that  the  case  was  similar  to 
one  of  a  remainder  dependent  on  the  termination  of 
a  life  estate  and  liable  to  be  divested  only  by  the  death 
of  the  remainderman,  and  that  the  provisions  of  the 
law  of  1897  by  which  it  was  attempted  to  reach  an  es- 
tate created  by  deeds,  made  before  the  existence  of  any 
inheritance  tax  law,  and  creating  a  vested  estate,  was 
unconstitutional.  See  Matter  of  Pell,  171  N.  Y.  48. 
The  court  also  distinguished  this  case  from  the  Van- 
derbilt Case  {supra),  holding  that  in  the  Vanderbilt 


POWER   OF    APPOINTMENT.  95 

Case  the  power  of  appointment  having  been  created 
by  will,  the  tax  upon  the  estate  passing  under  such 
a  power  was  a  tax  on  succession,  while  a  tax  on  the 
transfer  by  deed  was  one  on  the  property,  and  declar- 
ing such  property  subject  to  tax  would  give  a  retro- 
active effect  to  the  amendment  of  1897,  which  would 
violate  the  Constitution. 

The  Court  of  Appeals  reversed  the  Appellate  Divi- 
sion, holding  that  subdivision  5  of  section  220  is  con- 
stitutional, and  imposes  a  tax  upon  the  exercise  of  a 
power  of  appointment  by  will,  although  such  appoint- 
ment is  derived  from  a  deed  executed  long  before  the 
passage  of  any  act  imposing  a  succession  tax ;  that  the 
statute  applies  alike  to  all  powers  of  appointment  with- 
out distinction  on  account  of  the  method  of  creation  or 
date  of  creation.* 

1 1 5a.  Appointee  Can  Elect  to  Take  under  the  Exercise  of  a 
Power,  or  under  the  Former  Will  or  Deed. 

An  appointee  under  a  power  has  the  right  of  election 
the  same  as  a  grantee  under  a  deed,  and  where  the 
exercise  of  a  power,  respecting  a  trust  fund,  leaves 

*  The  Delano  Case  (supra)  arose  upon  a  motion  made  to  the  surro- 
gate of  New  York  county  to  declare  the  transfer  by  will  of  Laura  Astor 
Delano  exempt.  The  estate  of  Laura  Astor  Delano  has  now  been  ap- 
praised and  tax  assessed  upon  the  transfer  of  the  property  under  the 
power  of  appointment  under  her  will,  and  an  appeal  was  taken  from  the 
order  assessing  the  tax  thereon,  upon  the  grounds  that  chapter  284,  Laws 
of  1897  does  not  apply,  as  the  property  was  acquired  under  deeds  exe- 
cuted in  1844,  1848,  1849,  and  1865, —  that  the  act  is  unconstitutional 
under  the  following  provisions  of  the  State  Constitution,  viz.:  Section 
24,  article  HI:  section  6,  article  I;  section  10,  article  I,  and  section  1 
of  the  Fourteenth  Amendment.  That  if  the  property  so  appointed  is 
held  taxable,  that  such  t;i\  should  be  fixed  with  respect  to  the  relation- 
ship of  the  appointees  t<>  William  B.  Astor  and  not  with  respect  to 
their  relationship  to  said  Laura  Astor  Delano.  The  Appellate  Division, 
First  Department,  affirmed  the  order  asessing  the  tax.  without  opinion, 
New  York  Law  Journal,  June  10.  1905.  This  case  will  doubtless  be 
taken  to  the  United  States  Supreme  Court. 


96  THE    LAW    OF    TAXABLE    TRANSFERS. 

everything  as  it  was  before,  it  is  a  mere  form,  with  no 
substance,  and  the  appointee  can  elect  to  take  under  a 
prior  will,  which  vested  in  the  appointee,  the  same 
property  after  the  termination  of  a  life  estate  subject 
to  appointment  by  the  life  tenant.  In  such  a  case  there 
will  be  no  taxable  transfer  by  reason  of  the  exercise 
of  the  power,  because,  "  although  the  power  was  ex- 
ercised in  form,  her  title  was  perfect  without  it  and 
she  derived  no  benefit  from  it.  *  *  *  The  attempt 
to  execute  a  power  was  not  effective  because  it  did 
nothing."    Matter  of  Lansing,  182  N.  T.  238. 

But  where  an  appointee  is  given  by  deed  of  his 
grandfather  an  undivided  fourth  of  certain  property 
and  by  the  exercise  of  a  power  of  appointment  over 
this  same  property  he  was  given  the  whole  thereof 
absolutely,  the  appointee  cannot  claim  one-fourth 
thereof  under  the  deed  so  as  to  escape  the  transfer  tax 
thereon,  and  the  three-fourths  thereof  under  the  exer- 
cise of  the  power,  for  he  was  bound  to  accept  or  reject 
under  the  will  exercising  the  power  as  an  entirety.  If 
he  accepted  under  the  power  at  all,  he  was  obliged  to 
accept  all  that  purported  to  come  to  him  thereby,  and 
having  elected  to  claim  under  the  power,  he  was  com- 
pelled to  accept  the  appointment  as  made  and  take  all 
the  property  covered  thereby.  See  Matter  of  Lansing, 
182  N.  Y.  238,  where  the  court,  in  the  opinion  in  that 
case,  refers  to  the  Matter  of  Delano,  176  N.  Y.  486. 

1 1 6.  Time  of  Payment  is  When  the  Power  of  Appointment  is 
Exercised. 

In  the  Matter  of  Howe,  86  App.  Div.  286,  83  N.  Y.  S. 
825;  affd.,  176  N.  Y.  570,  on  the  opinion  below,  the 


POWER    OF    APPOINTMENT.  97 

court  held  that,  under  subdivision  5  of  section  220,  it 
is  the  exercise  of  the  power  of  appointment,  and  not 
the  creation  of  the  power,  which  effects  the  taxable 
transfer,  and  the  remainder  subject  to  the  exercise  of 
an  appointment  is  therefore  not  taxable  until  the  time 
arrives  for  the  exercise  of  the  testamentary  power 
of  appointment  conferred  upon  the  life  beneficiary. 
Matter  of  Seaver,  63  App.  Div.  283,  71  N.  Y.  S.  544; 
Matter  of  Wahvorth,  66  App.  Div.  171,  72  N.  Y.  S.  984. 
The  decedent  gave  one  share  of  her  estate  in  trust 
for  Leavitt  Howe  during  his  life,  giving  the  said  life 
tenant  power  to  appoint  said  fund  among  such  per- 
sons as  he  might  name  in  his  will,  also  another  share 
in  trust  for  Edward  Howe,  upon  the  same  conditions 
with  power  of  appointment,  and  in  both  instances  pro- 
viding that  upon  failure  to  exercise  said  power  the 
funds  should  be  paid  over  to  the  children  of  such  life 
tenants  respectively.  The  surrogate  held  that  neither 
of  the  remainders  were  taxable  until  the  time  comes  for 
the  exercise  of  the  power  conferred  upon  the  life  bene- 
ficiaries. It  was  claimed  on  the  part  of  the  Comptroller 
that  subdivision  5  of  section  220  was  repealed  by  im- 
plication by  chapter  76,  Laws  of  1899,  amending  sec- 
tion 230  of  the  Tax  Law,  by  inserting  therein  the  pro- 
vision : 

When  property  is  transferred  in  trust  or  otherwise,  and 
the  rights,  interest,  or  estates  of  the  transferees  are  dependent 
upon  contingencies  or  conditions  whereby  they  may  be  wholly 
or  in  part  created,  defeated,  extended,  or  abridged,  a  tax  shall 
be  imposed  upon  said  transfer  at  the  highest  rate  which,  on 
the  happening  of  any  of  said  contingencies  or  conditions, 
would  be  possible  under  the  provisions  of  this  article,  and 
7 


98  THE    LAW    OF    TAXABLE    TRANSFERS. 

such  tax  so  imposed  shall  be  due  and  payable  forthwith  out 
of  the  property  transferred. 

The  court  says : 
The  phraseology  of  this  amendment  of  1899  is  not  such 
as  necessarily  to  embrace  a  case  like  the  present,  where  a  tes- 
tamentary power  of  appointment  is  bestowed  upon  the  life 
beneficiary  of  a  trust.  While  here  Leavitt  Howe  and  Ed- 
ward Howe  may  be  regarded  as  the  original  transferees  of 
the  shares  devised  and  bequeathed  in  trust  for  their  benefit 
it  cannot  fairly  be  said  that  their  rights,  interests,  or  estates 
are  dependent  upon  contingencies  or  conditions  whereby  they 
may  be  wholly  or  in  part  created,  defeated,  extended,  or 
abridged.  Their  right,  interest,  and  estate  in  the  share  or 
money  set  apart  in  trust  for  each  is  absolute,  and  not  de- 
pendent upon  any  contingency  or  condition  whatever.  They 
are  entitled  under  the  will  to  the  proceeds  of  the  fund  left 
in  trust  for  them  during  the  whole  of  their  natural  lives.  It 
would  seem  therefore  that  their  estates  do  not  fall  within 
the  scope  of  the  amendment,  and  it  may  well  be  doubted 
whether  the  amendment  was  intended  to  apply  at  all  to  cases 
where  a  life  estate  is  coupled  with  a  testamentary  power  of 
appointment  to  be  exercised  at  its  conclusion.  It  is  to  be  ob- 
served that  the  amendatory  statute  (Laws  of  1899,  chap.  76) 
makes  no  change  whatever  in  any  section  of  the  Tax  Law, 
except  section  230.  It  leaves  unchanged  section  220,  the 
fifth  subdivision  of  which,  relating  to  powers  of  appointment, 
has  already  been  quoted.  The  effect  of  the  amendment 
therefore  was  the  same  as  though  one  statute  had  been  en- 
acted containing  subdivision  5  of  section  220,  and  section 
230,  as  changed  in  1899.  We  thus  have  in  contemplation 
of  law  an  act  of  the  Legislature  containing  specific  directions 
as  to  the  taxation  of  estates  in  regard  to  which  a  power  of 
appointment  is  conferred  upon  the  original  transferee ;  and 
I  do  not  see  how  it  can  well  be  held  that  a  subsequent  pro- 
vision in  the  same  statute  in  regard  to  the  taxation  of  trans- 
fers of  property,  where  the  estates  of  the  transferees  are  de- 
pendent upon  contingencies  or  conditions,  effects  a  repeal  by 


POWER   OF    APPOINTMENT.  99 

implication  of  the  specific  provision  relating  to  transfers 
through  the  instrumentality  of  the  donee  of  a  power. 

Neither  Matter  of  Vanderbilt,  172  X.  Y.  69,  nor  Matter 
of  Brez,  172  X.  Y.  609,  bears  upon  the  question  in  con- 
troversy here.  Those  decisions  relate  wholly  to  the  effect  of 
section  230  of  the  Tax  Law  (as  amended  by  Laws  of  1899, 
chap.  76),  and  the  opinions  contain  nothing  in  conflict  with 
the  views  which  have  been  expressed. 

I  think  that  the  decree  of  the  Surrogate's  Court  should  be 
affirmed. 

117.   Erroneous  Payment   Cannot   be   Considered  a  Payment 
Made  "  in  Advance." 

An  erroneous  payment  of  tax  upon  a  fund  over 
which  the  life  tenant  was  given  a  power  of  appoint- 
ment cannot  be  considered  as  a  payment  in  advance, 
or  applied  in  payment  of  the  tax  thereafter  properly 
assessable  upon  a  subsequent  transfer  of  said  fund  by 
the  exercise  of  an  appointment  given  the  life  tenant. 

A  decedent  died  May  12,  1904,  without  issue,  and 
leaving  a  will  whereby  he  exercised  an  appointment 
over  a  trust  fund  of  $85,477.59  in  favor  of  his  wife. 

The  uncle  of  the  decedent  died  December  1,  1888, 
leaving  a  will  in  which  he  created  a  trust  fund,  the  in- 
come of  which  was  to  be  paid  to  the  nephew  for  life, 
with  remainder  to  the  issue  of  said  nephew,  or  if  he 
died  without  issue,  then  the  remainder  was  to  pass  as 
the  nephew  might  appoint  by  his  will.  It  appears  that 
in  proceedings  instituted  upon  the  uncle's  estate  in 
1888,  the  whole  trust  fund  was  taxed  at  5  per  cent., 
whereas  the  only  taxable  interest  was  the  value  of  the 
nephew's  life  estate  therein.  No  application  was  ever 
made  for  a  refund  of  the  tax  assessed  upon  the  re- 


100        THE  LAW  OF  TAXABLE  TRANSFERS. 

mainder  in  said  trust  fund,  and  under  the  statute  in 
force  at  that  time  such  application  became  barred  after 
the  expiration  of  five  years  from  the  payment  of  the 
tax. 

In  the  proceedings  in  the  nephew's  estate  to  fix  the 
transfer  tax,  the  appointee  claims  that  inasmuch  as  a 
tax  of  5  per  cent,  was  paid  upon  the  whole  trust  fund 
in  1888,  that  she  should  not  be  required  to  pay  any  tax 
upon  the  transfer  to  her  by  the  nephew's  will  in  1904, 
and  the  surrogate  of  Dutchess  county  grants  the  relief 
she  asks,  stating  that  the  State  has  once  received  a  tax 
upon  the  whole  of  this  trust  fund,  and  therefore  the 
purpose  of  the  statute  has  been  satisfied  and  that  he 
will  consider  the  payment  made  in  1888  in  the  uncle's 
estate  as  made  in  advance  of  any  payment  which  might 
otherwise  be  due  upon  the  transfer  under  the  nephew's 
will  in  respect  to  said  trust  fund. 

On  appeal  by  the  Comptroller,  the  Appellate  Divi- 
sion of  the  Second  Department  {Matter  of  Bucking- 
ham, 105  App.  Div.  )  reversed  the  order  of  the 
surrogate,  saying  in  part:     "  *  *     It  is  impos- 

sible therefore  to  hold,  as  matter  of  fact,  that  these 
taxes  were  levied  in  advance  upon  the  interest  to 
which  Elizabeth  Buckingham  now  succeeds.  It  might 
indeed  be  possible  to  regard  those  levies  as  made 
in  advance  upon  the  remainders  created  by  the  will 
of  (the  uncle),  Stephen  M.  Buckingham,  which  re- 
mainders finally  failed  because  of  the  absence  of 
issue  of  his  nephew,  but  they  cannot  be  regarded  as 
assessments  in  advance  upon  the  right  of  Charles  H. 
Buckingham's  appointee  to  take  in  succession,  because 
such  a  right  was  not  made  taxable  until  eight  years 


POWER    OF    APPOINTMENT.  101 

afterward,  viz.,  in  the  year  1897.  It  cannot  be  assumed 
that  the  taxing  power  anticipated  the  law,  as  well  as 
the  future  assessment." 

After  reviewing  the  cases,  showing  that  it  is  the 
transfer  upon  the  exercise  of  the  power  that  is  taxable, 
the  court  further  says :  ' '  *  *  It  follows  that  the 
transfer  tax  which  is  sought  to  be  imposed  in  these 
proceedings  must  be  regarded  as  imposed  upon  a 
transfer  created  by  the  will  of  Charles  H.  Buckingham, 
and  not  by  the  will  of  Stephen  M.  Buckingham;  that 
at  the  time  of  the  settlement  of  the  estate  of  Stephen 
M.  Buckingham  there  was  no  law  in  existence  author- 
izing the  imposition  of  such  a  tax ;  that  the  imposition 
of  such  a  tax  was  not  anticipated  in  fact,  and  could  not 
have  been  anticipated  in  the  proceedings  by  which  the 
inheritance  taxes  were  adjusted  and  collected  in  the 
estate  of  Stephen  M.  Buckingham,  and  that  the  right 
of  Elizabeth  Buckingham  to  succeed  to  the  fund  in 
question  is  taxable  as  a  transfer  effected  by  the  opera- 
tion of  her  husband's  will  with  the  like  effect  as  though 
such  fund  belonged  absolutely  to  him  and  had  been  be- 
queathed to  her  in  and  by  his  will." 

1 1 8.  When  the  Power  is  Deemed  to  Have  Been  Exercised. 

The  will  of  David  Dows,  Sr.,  who  died  in  1890,  and 
prior  to  the  act  taxing  transfers  to  lineals  and  others, 
conferred  upon  his  daughter  Linda  Dows  Cooksey  a 
power  of  appointment  over  one-eighth  part  of  his 
residuary  estate  in  which  she  enjoyed  a  life  estate,  said 
will  providing  as  follows: 

*     *     *      And  upon  the  death  of  said  person  one-eighth 
part  of  my  said  residuary  estate,  which  for  and  during  the 


102        THE  LAW  OF  TAXABLE  TRANSFERS. 

lifetime  of  such  person  had  been  so  held  in  trust  as  aforesaid, 
shall,  with  all  accumulations  of  interest,  income  and  profits, 
vest  absolutely  and  at  once  in  such  of  his  or  her  children,  or 
the  issue  of  such  children  as  he  or  she  may,  by  his  or  her  last 
will  and  testament  designate  and  appoint,  and  in  such  man- 
ner and  upon  such  terms  as  he  or  she  may  legally  impose ; 
but  in  case  such  person  dies  intestate,  then  said  one-eighth 
part  of  my  said  residuary  estate,  which  had  been  held  in  trust 
as  aforesaid  for  and  during  the  lifetime  of  such  person,  shall 
thereupon  vest  absolutely  and  at  once  in  his  or  her  children, 
him  or  her  surviving,  share  and  share  alike,  and  the  issue 
of  his  or  her  deceased  children  (such  issue  to  take  share  and 
share  alike  the  portion  which  would  have  been  received  by  the 
parent  by  the  terms  hereof,  if  living)  to  be  paid  to  them  at 
the  times  and  in  the  proportions  following,  to  wit :  "As  each 
attains  the  age  of  twenty-one  years,  there  shall  be  paid  to 
him  or  her  a  sum  not  to  exceed  fifty  thousand  dollars 
($50,000)  ;  as  each  attains  the  age  of  twenty-five  years  a 
further  sum  not  to  exceed  one  hundred  thousand  dollars 
($100,000)  ;  as  each  attains  the  age  of  thirty  years  the  re- 
mainder, if  any,  of  the  share  of  said  one-eighth  part  of  my 
said  residuary  estate  with  all  accumulations  of  interest,  in- 
come, and  profits,  to  which  he  or  she  may  be  entitled,  except- 
ing, however,  that  said  children  and  said  issue  of  deceased 
children  shall,  each  of  them,  receive  from  his  or  her  respect- 
ive share  of  said  one-eighth  part  of  my  said  residuary  estate 
which  is  herein  provided  shall  vest  in  such  child,  or  said  issue 
of  a  deceased  child,  the  entire  income  from  and  after  he  or 
she  shall  have  attained  the  age  of  twenty-one  years,  and  dur- 
ing the  minority,  such  sum  or  sums  not  to  exceed  five  thou- 
sand dollars  ($5,000)  in  any  one  year  as  in  the  judgment 
and  discretion  of  his  or  her  guardian  may  seem  right  and 
proper  for  the  maintenance,  education,  and  support  of  such 
child  or  said  issue  of  a  deceased  child." 

The  daughter,  Linda  Dows  Cooksey,  by  the  second 
paragraph  of  her  will,  after  referring  to  the  paragraph 


POWER    OF    APPOINTMENT.  103 

in  her  father's  will  giving  her  the  power  to  appoint 
the  remainder  in  which  she  has  the  life  use  says, 
"  *  now  in  pursuance  of  and  exercising  such 

power,  I  do  hereby  appoint,  designate,  and  direct  as 
follows :  The  property  composing  the  said  one-eighth 
share  in  my  father's  residuary  estate,  shall,  upon  my 
death,  vest,  share  and  share  alike  in  my  then  living 
children,  and  the  then  living  issue  of  my  deceased 
children  (such  issue  to  take  share  and  share  alike  the 
portion  which  would  have  been  received  by  the  parent 
by  the  terms  hereof,  if  living)  to  be  paid  to  them  at 
the  time  and  in  the  proportions  following,  to -wit:" 

Then  follows  a  provision  which  is  substantially  the 
same  as  the  one  in  the  father's  will  in  respect  to  the 
disposition  to  be  made  of  the  one-eighth  of  his  estate 
in  the  event  of  the  daughter  dying  intestate  as  quoted 
above,  except  that  the  daughter  appoints  to  each  child 
absolute})),  as  they  attain  the  age  of  twenty-one  and 
twenty-five  years,  the  sum  of  $50,000  and  $100,000, 
respectively,  and  when  they  attain  the  age  of  thirty 
years,  the  remainder  with  all  accumulations,  shall  vest 
equally  in  such  children. 

The  surrogate  held  that  there  was  a  valid  exer- 
eise  of  the  power  by  the  will  of  the  daughler  and 
entered  an  order  assessing  a  transfer  tax  thereon. 
The  appointees  appeal  from  the  order  of  the  surrogate 
on  the  grounds:  First,  that  the  will  of  Linda  Dows 
Cooksey  does  not  constitute  a  substantial  exercise  of 
the  power  given  her  under  the  eighth  paragraph  of  her 
father's  will;  second,  that  subdivision  5  of  section  220 
is  unconstitutional ;  third,  that  the  children  of  Linda 


104  THE   LAW    OF   TAXABLE    TRANSFERS. 

Dows  Cooksey,  upon  the  death  of  their  grandfather  in 
1890,  acquired  vested  rights  in  the  property  trans- 
ferred which  were  not  in  any  manner  changed  by  the 
provisions  of  the  will  of  said  Linda  Dows  Cooksey. 
The  Appellate  Division  affirmed  the  order  of  the  sur- 
rogate January  6,  1905,  upon  the  opinion  in  the  Mat- 
ter of  Vanderbilt,  50  App.  Div.  246,  63  N.  Y.  S.  1079; 
aflfd.,  163  N.  Y.  597. 

The  Court  of  Appeals,  June  6,  1905,  affirmed  the 
order  of  the  surrogate  and  the  Appellate  Division, 
saying:  "  *  *  *  Under  the  will  of  Mrs.  Cooksey, 
in  exercising  the  power  of  appointment,  she  made  ma- 
terial changes  with  reference  to  paying  over  the  re- 
mainder to  her  children  from  that  incorporated  in  the 
will  of  her  father.  While  each  of  her  children  may 
ultimately  receive  the  same  amount,  yet  she,  by  her 
will,  has  fixed  definitely  the  amounts  that  shall  be  paid 
to  each  of  her  children  upon  their  arriving  at  the  ages 
of  twenty-one  and  twenty-five  years,  leaving  no  dis- 
cretion in  the  trustees  as  to  the  amounts  that  shall  be 
paid  over  to  them,  and  then  vests  in  the  trustees  the 
discretionary  power  to  determine  how  much  shall  be 
used  for  the  support  and  education  of  the  children  dur- 
ing their  minority.  It  appears  to  us,  therefore,  that 
there  was  a  necessity  for  exercising  the  power;  that 
it  cannot  be  treated  as  a  nullity,  and,  therefore,  the 
transfer  tax  under  the  statute  was  properly  assessed. ' ' 
Matter  of  Cooksey,  182  N.  Y.  92, 

The  Matter  of  Lansing,  182  N.  Y.  238,  was  a  com- 
panion case  to  the  Matter  of  Cooksey  (supra),  in  point 
of  argument  and  decision  by  the  Court  of  Appeals. 


POWER    OF    APPOINTMENT.  105 

In  this  case  the  father  of  Janet  S.  Lansing,  the  de- 
cedent, died  April  11,  1869,  leaving  a  will  wherein  he 
disposed  of  his  residuary  estate  as  follows : 

Sixth.  All  the  residue  of  my  estate,  real  and  personal, 
divided  into  as  many  equal  portions  as  I  shall  leave  children 
and  issue  collectively  of  any  deceased  child,  me  surviving,  I 
give  and  devise  as  follows :  One  of  said  equal  portions  I  give 
and  devise  as  to  the  issue  collectively  of  each  of  my  children 
who  shall  have  died  during  my  life,  leaving  issue.  To  have 
and  to  hold  to  such  issue  in  fee  simple  absolute.  One  other 
of  said  equal  portions  I  give  and  devise  to  the  persons  herein- 
after appointed  as  Trustee  for  each  of  my  children  living  at 
the  time  of  my  death.  To  have  and  to  hold  such  portion  of 
each  child  in  severalty  in  trust  during  the  life  of  such  child, 
and  to  receive  the  rents,  issues  and  profits  thereof  during 
such  life,  and  to  apply  the  same  to  the  use  of  such  child  dur- 
ing her  life,  and  after  the  death  of  each  of  my  children  I  give 
the  portions  so  held  in  trust  for  her  to  her  heirs  at  law  sub- 
ject, however,  to  the  power  of  such  child  to  devise  hereinafter 
contained. 

Eighth.  As  to  the  portions  of  each  of  my  children  de- 
vised by  the  sixth  item  of  this  my  will  to  the  Trustees  for 
the  life  of  such  child  and  after  the  death  of  such  child  to  the 
heirs  at  law  of  such  child,  I  hereby  authorize  each  child  by 
a  last  will  duly  executed  to  dispose  of  the  remainder  in  fee 
after  the  termination  of  the  trust  estate  by  her  death  among 
her  heirs  at  law  and  her  collateral  relatives  in  such  propor- 
tion and  manner  and  with  such  limitations  as  she  may  de- 
sire, and  I  declare  the  devise  of  each  remainder  at  the  foot 
of  the  sixth  item  of  this  my  will  to  the  heirs  at  law  to  be 
subject  to  this  power  given  to  each  of  my  children. 

Janet  S.  Lansing  died  October  13,  1904,  leaving  a 
will  wherein  she  exercised  the  power  of  appointment 
conferred  upon  her  as  follows : 

Second.  Under  and  by  virtue  of  the  power  and  authority 
given  to  me  in  and  by  the  last  will  and  testament  of  my 


106         THE  LAW  OF  TAXABLE  TRANSFERS. 

father,  the  late  Thomas  Suffern,  and  particularly  in  and  by 
the  Eighth  Clause  or  subdivision  thereof,  I  give,  devise  and 
bequeath,  the  equal  share  or  portion  of  the  estate  of  my  said 
father,  given  and  devised  in  and  by  the  Sixth  Clause  or  sub- 
division of  his  said  will  to  the  trustees  appointed  in  and  by 
the  said  will  in  trust  for  me  to  my  said  daughter,  Janet  Lans- 
ing McViekar,  to  have  and  to  hold  the  same  to  her,  her  heirs 
and  assigns  forever,  in  fee  simple  and  absolute  ownership. 

It  will  be  observed  that  in  the  Coohsey  Case  {supra), 
the  grantor  of  the  power  first  gives  the  estate  in  re- 
mainder to  such  of  his  or  her  children  as  he  or  she 
may  by  will  designate  and  appoint,  and  failing  such 
appointment,  then  the  remainder  is  given  absolutely  to 
the  children  who  survive  the  life  tenant,  whereas  in 
the  Lansing  Case  the  testator  created  a  life  estate  in 
favor  of  his  daughter,  and  upon  her  death  gave  the 
portion  of  his  estate  so  held  in  trust  to  the  daughter's 
heirs-at-law,  subject,  however,  to  the  power  of  the 
daughter  to  appoint  such  property  among  her  heirs- 
at-law,  and  her  collateral  relatives.  An  order  was 
entered  by  Surrogate  Fitzgerald  of  New  York  county, 
February  21,  1905,  assessing  a  tax  on  the  fund 
transferred  by  exercise  of  the  power  of  appointment, 
and  the  executor  and  appointee  appeals  from  this 
order,  stating  several  grounds,  the  principal  ones 
being  that  the  granddaughter  took  a  vested  interest 
under  the  will  of  her  grandfather  in  1869;  that  the 
said  Janet  S.  Lansing  failed  to  exercise  the  power  of 
appointment  given  her  under  her  father's  will,  and 
that  subdivision  5  of  section  220  is  unconstitutional. 

The  Appellate  Division  affirmed  the  order  of  the 
surrogate,  without  opinion. 


POWER    OF    APPOINTMENT.  107 

The  Court  of  Appeals,  June  13,  1905,  modified  the 
order  of  the  surrogate  and  the  Appellate  Division  by 
deducting  therefrom  the  value  of  the  property  over 
which  the  daughter,  Janet  L.  Lansing,  attempted  to 
exercise  an  appointment  in  favor  of  her  daughter 
Janet  Lansing  McVicker,  holding,  that  by  the  will  of 
the  father  of  Janet  S.  Lansing  and  by  the  same  sen- 
tence which  created  the  trust  during  her  life,  the  prop- 
erty was  given  after  her  death,  to  the  granddaughter, 
Mrs.  McVickar,  who  was  the  heir-at-law  of  the  daugh- 
ter at  the  time  of  the  grandfather 's  death ;  that  it  was 
not  necessary  to  determine  whether  the  remainder 
which  Mrs.  McVickar  took  under  her  grandfather's 
will  was  vested  or  contingent,  as  such  interest  was  ac- 
quired at  the  instant  of  the  grandfather's  death,  sub- 
ject, however,  to  the  power  of  appointment;  that  the 
power  of  appointment,  as  formally  exercised,  gave 
Miss  McVickar  all  the  property,  the  same  as  her  grand- 
father had  given  it  to  her  more  than  thirty  years  be- 
fore, and  that  the  exercise  of  this  power  by  the  will  of 
Janet  S.  Lansing  neither  increased  nor  diminished  the 
estate  of  Mrs.  McVickar,  and  did  not  affect  in  any 
degree,  the  value  of  her  grandfather's  gift;  that  the 
execution  of  the  power  in  this  case  left  the  title  where 
it  was  before,  and  the  result  is  the  same  as  if  there  had 
been  no  power  to  exercise,  and  especially  was  this  so 
as  the  granddaughter,  Mrs.  McVickar,  claimed  title  to 
the  property  under  her  grandfather's  will,  and  that 
nothing  passed  to  her  through  the  appointment  in  her 
mother's  will. 


108  THE   LAW    OF    TAXABLE    TRANSFERS. 

119.  Taxability  of  Transfers  Where  Funds  Over  Which  Power 
is  Exercised  are  Without  This  State. 

A  nonresident  testator,  whose  property  was,  and 
remained  wholly  in  the  State  of  his  domicile,  gave 
such  property  in  trust  to  trustees  who  also  resided  at 
the  testator's  domicile,  to  pay  the  income  thereof  to 
his  daughter  for  life,  and  after  the  daughter's  death 
to  pay  or  transfer  the  fund  in  such  manner  as  she  by 
her  last  will  may  direct,  and  in  default  of  such  ap- 
pointment, to  such  persons  as  by  the  laws  of  Maryland 
may  be  entitled  to  the  same  as  her  heirs.  At  the  time 
of  the  daughter's  death  in  1902  she  was  a  resident  of 
this  State  and  left  a  will  by  which  she  appointed  six 
legacies  of  $1,000  each,  to  be  paid  out  of  her  father's 
estate  to  certain  nephews  and  nieces  and  the  balance 
of  said  fund,  together  with  her  individual  estate,  she 
gave  to  her  husband.  The  appraiser  included  in  his 
appraisal  the  amount  of  the  fund  passing  under  the 
exercise  of  the  power,  as  well  as  the  daughter's  indi- 
vidual property,  and  an  order  was  made  confirming 
the  report  and  fixing  the  tax  accordingly.  Upon  the 
appeal  by  the  executor  of  the  daughter's  will,  the  sur- 
rogate held  that  while  a  strict  construction  of  the  stat- 
ute (subd.  5  of  §  220)  would  require  the  imposition 
of  the  tax,  yet  he  did  not  think  that  the  Legislature 
intended  such  a  result,  as  applied  to  the  facts  in  this 
case;  that  in  the  present  case  no  transfer  of  any  kind 
of  any  part  of  the  assets  of  the  estate  of  the  nonresi- 
dent testator  in  the  hands  of  his  trustees  at  the  time 
of  the  death  of  his  daughter  has  been  effected  or  per- 


POWER    OF    APPOINTMENT.  109 

mitted  by  any  law  of  the  State  of  New  York;  that  all 
of  those  assets  were  in  the  State  of  Maryland,  held  by 
trustees  residing  there,  under  a  will  of  a  citizen  of  that 
State  and  pursuant  to  the  laws  of  that  State.  That  in 
all  of  the  eases  it  is  quite  clearly  asserted  that  the  tax 
is  one,  not  upon  property  but  upon  transfers  of  prop- 
erty made  by  will  or  descent,  where  the  right  to  make 
or  receive  such  transfers  is  accorded  by  the  laws  of 
this  State,  and  which  right  the  sovereign  power  of  this 
State  may  lawfully  abridge  by  the  amount  of  the  tax. 
Matter  of  Thomas,  39  Misc.  Rep.  136,  78  N.  Y.  S.  981. 
Citing  Matter  of  Vanderbilt,  50  App.  Div.  246-252,  63 
N.  Y.  S.  1079;  affd.,  163  N.  Y.  597,  and  Matter  of  Dows, 
167  X.  Y.  231. 

No  appeal  was  taken  from  this  decision,  doubtless 
for  the  reason  that  if  the  transfer  was  held  a  taxable 
transfer  under  the  statute,  it  is  not  apparent  how  the 
tax  thereon  could  be  collected,  as  the  property  trans- 
ferred was  all  without  this  State  and  it  does  not  ap- 
pear that  the  appointees  were  residents,  yet  the  courts 
have  held  that  whether  or  not  the  tax  can  be  collected 
is  not  to  be  considered,  if  the  transfer  is  properly  tax- 
able. Matter  of  Dingman,  66  App.  Div.  228,  229,  72 
N.  Y.  S.  671. 

120.  When  Remaindermen  not  Bound  by  Acts  of  Life  Tenant 
—  Failing  to  Exercise  Power. 

Joshua  Mather  died  in  1893,  giving  his  nephew, 
Charles  W.  Mather,  a  life  estate  in  his  residuary  es- 
tate, with  power  of  appointment  by  will,  or,  if  he  left 
no  will,  then  the  remainder  should  pass  to  the  nephew's 
heirs  and  next  of  kin. 


110        THE  LAW  OF  TAXABLE  TRANSFERS. 

Upon  the  appraisal  of  the  uncle 's  estate  the  nephew 
testified  that  the  uncle,  at  the  time  of  his  death,  was 
the  owner  of  a  certain  piece  of  valuable  real  estate, 
and  the  tax  was  assessed  upon  the  nephew's  life  estate 
therein,  and  the  tax  on  the  remainder  was  suspended 
until  his  death,  whereas  it  appeared  when  the  nephew 
died  that  the  uncle  had  conveyed  this  piece  of  real  es- 
tate to  the  nephew  in  his  lifetime  by  a  duly  executed 
but  unrecorded  deed,  and  that  the  nephew,  not  the 
uncle,  was  the  owner  at  the  time  the  tax  was  assessed. 
The  court  held  that  the  nephew  having  for  some  un- 
disclosed reason  voluntarily  determined  to  ignore  his 
absolute  title  to  the  property  and  to  submit  to  the  im- 
position of  the  transfer  tax  upon  his  life  interest,  such 
transfer  tax  should  not  be  vacated.  The  court  held 
further,  however,  that  the  statement  of  the  nephew, 
who  died  intestate,  was  not  binding  upon  the  remain- 
dermen, and  that  they  could  claim  their  title  to  this 
real  estate  through  the  deed  from  the  uncle  to  their 
father,  and  they  having  elected  to  stand  upon  their 
title  under  the  deed  they  were  not  liable  for  a  transfer 
tax  in  respect  to  the  real  property.  Matter  of  Mather, 
90  App.  Div.  382,  85  N.  Y.  S.  657. 

121.  When  Tax  on  Transfers   under  a  Power  Will  be  Paid 
from  the  Donee's  Residuary  Estate. 

Where  the  testatrix  by  the  first  clause  of  her  will 
exercises  a  power  over  a  fund  of  $500,000,  of  which 
she  has  had  the  life  use  under  her  father's  will,  and 
by  subsequent  clauses  disposes  of  her  individual  funds 
using,  with  respect  to  all  of  said  gifts,  the  words  "  I 
give  and  bequeath  ' '  and  then  by  the  last  clause  of  her 


POWER    OF    APPOINTMENT.  Ill 

will  she  directs  her  executors  to  pay  out  of  her  residu- 
ary estate  any  and  all  transfer  or  inheritance  taxes 
that  may  be  imposed, —  held,  that  it  was  not  the  inten- 
tion of  the  testatrix  to  make  any  distinction  concern- 
ing the  payment  of  the  transfer  tax  between  the  gifts 
which  she  made  pursuant  to  the  power  of  appointment 
contained  in  her  father's  will  and  those  which  she 
made  out  of  her  individual  property.  Isham  v.  New 
York  Assn.  for  the  Poor,  78  App.  Div.  396,  79  N.  Y.  S. 
1048;  affd.,  177  N.  Y.  218. 

1 22.  Failure  to  Exercise  Power  —  Equitable  Conversion. 

Decedent  conveyed  all  her  real  estate  to  trustees 
with  power  to  sell  or  mortgage,  upon  conditions  that 
they  should  pay  her  a  certain  life  income,  and  provid- 
ing that  at  her  death  her  children  should  have  equal 
shares  of  the  trust  estate,  but  that  the  shares  of  the 
daughters  should  be  held  in  trust  for  each  daughter 
respectively,  and  giving  to  each  daughter  power  to  ap- 
point her  share  among  her  lawful  issue,  and  failing 
the  exercise  of  that  power,  her  share  was  to  go  to  such 
daughter's  surviving  issue.  After  the  grantor's  death 
a  daughter  died  without  exercising  the  power,  but 
leaving  issue ;  and  it  appears  that  the  trustees  had  con- 
verted all  the  real  estate  into  personalty.  Held,  that 
the  transfer  of  the  share  of  the  deceased  daughter  to 
her  children  was  taxable  as  personalty,  and  that  the 
doctrine  of  equitable  conversion  could  not  be  invoked 
for  the  purpose  of  exempting  the  property  from  tax- 
ation. Matter  of  Bartow,  30  Misc.  Rep.  27,  62  N.  Y.  S. 
1000. 


112        THE  LAW  OF  TAXABLE  TRANSFERS. 

1 23.  When  Grantee,   with  Power  to  Dispose,  is  Entitled  to  an 

Absolute  Fee. 

Under  a  testator's  devise  of  all  his  real  estate  to  his 
wife  during  life  ' '  to  be  retained  or  disposed  of  as  she 
may  think  proper,"  no  remainder  or  trust  being  lim- 
ited or  created,  she  takes  an  absolute  fee  under  section 
131  of  the  Real  Property  Law  (chapter  547,  Laws  of 
1896),  which  provides  as  follows: 

§  131.  When  Grantee  of  Power  has  Absolute  Fee. — 
Where  such  (i.  e.,  by  reference  to  preceding  sections,  abso- 
lute and  not  accompanied  by  a  trust)  a  power  of  disposition 
is  given  and  no  remainder  is  limited  on  the  estate  of  the 
grantee  of  the  power,  such  grantee  is  entitled  to  an  absolute 
fee. 

And  therefore  it  is  erroneous  to  assess  a  transfer 
tax  on  the  testator's  heirs-at-law  (some  of  whom  were 
collaterals),  on  the  theory  that  the  real  estate  de- 
scended from  him  to  them  merely  because  the  wife  died 
without  executing  her  power  of  disposition.  Matter 
of  Lynn,  34  Misc.  Rep.  681,  70  N.  Y.  S.  730. 

1 24.  Decisions  Affecting  Transfers  upon  the  Exercise  of  Power 

of  Appointment. 

The  courts  have  established,  in  respect  to  the  tax- 
ability of  transfers  under  a  power  of  appointment  and 
the  rights  and  liabilities  of  the  appointee  upon  the 
exercise  of  such  appointment,  the  following: 

(1.)  That  subdivision  5  of  section  220  is  constitu- 
tional. Matter  of  Vanderbilt,  50  App.  Div.  246,  63 
N.  Y.  S.  1079;  affd.,  163  N.  Y.  597;  followed  in  Matter 
of  Vanderbilt,  58  App.  Div.  619,  68  N.  Y.  S.  1150;  affd., 


POWER   OF    APPOINTMENT.  113 

166  N.  Y.  640;  Matter  of  Potter,  51  App.  Div.  212,  64 
N.  Y.  S.  1013;  Matter  of  Delano,  176  N.  Y.  486. 

(2.)  That  whatever  may  be  the  technical  source  of 
title  of  the  grantee  under  a  power  of  appointment,  it 
cannot  be  denied  that  in  reality  and  substance  it  is  the 
exercise  of  the  power  that  gives  to  the  grantee  the 
property  passing  under  it.  Matter  of  Doivs,  167  N.  Y. 
227.  But  where  the  effect  of  the  exercise  of  a  power 
is  merely  to  continue  the  title  to  property  already 
vested  or  contingent  in  the  appointee  by  the  same  will 
which  created  the  power,  such  an  appointment,  which 
leaves  everything  as  it  was  before  and  which  gives 
nothing  to  or  takes  nothing  from  the  appointee,  is  a 
mere  form,  and  does  not  make  a  taxable  transfer  by 
will,  under  subdivision  5  of  section  220,  where  the  ap- 
pointee elects  to  hold  her  title  under  the  former  will, 
as  she  can  accept  the  title  tendered  by  the  formal  exe- 
cution of  the  power  or  reject  it,  in  her  discretion. 
Matter  of  Lansing,  182  N.  Y.  238. 

(3.)  Where  a  will  purports  to  dispose  of  all  the 
testator's  property  it  operates  as  an  execution  of  a 
power  of  appointment,  unless  the  intent  that  it  shall 
not  so  operate  appears  expressly  or  by  implication. 
Lodcwood  v.  Middleberger,  159  N.  Y.  181. 

(4.)  That  the  tax  on  the  transfer  upon  the  exercise 
of  the  power  of  appointment  is  on  the  succession,  the 
same  as  in  other  cases.    Matter  of  Bows,  167  N.  Y.  227. 

(5.)  That  when  the  power  of  appointment  is  exer- 
cised the  statute  does  not  impose  a  tax  upon  the  prop- 
erty,  but  upon  the  exercise  of  the  power  by  will,  and 
the  statute  applies  alike  to  all  powers  of  appointment 

without  distinction  on  account  of  the  method  of  crea- 

s 


114  THE   LAW    OF   TAXABLE   TRANSFERS. 

tion,  or  date  of  creation.  Matter  of  Delano,  176  N.  Y. 
486. 

(6.)  That  the  tax  on  a  transfer  made  under  a  power 
given  to  a  life  tenant  to  appoint  the  remainder  therein 
must  be  assessed  at  the  death  of  the  life  tenant  on  the 
present  value  of  all  the  property  passing  under  the 
power.  Matter  of  Tucker,  27  Misc.  Rep.  616,  59  N. 
Y.  S.  699;  Matter  of  Stewart,  131  N.  Y.  274  (Act  1885). 

(7.)  The  relationship  between  the  donee  of  the  power 
and  the  appointee  under  his  will  determines  the  rate  of 
tax.  Matter  of  Seaver,  63  App.  Div.  283,  71  N.  Y.  S. 
544;  Matter  of  Walworth,  66  App.  Div.  171,  72  N.  Y.  S. 
984;  Matter  of  Rogers,  71  App.  Div.  461,  75  N.  Y. 
S.  835;  affd.  on  opinion  below,  172  N.  Y.  617. 

(8.)  That  while  the  property  at  the  time  of  the 
creation  of  the  power  may  have  been  real  estate,  if  it 
is  personal  property  when  the  power  is  exercised  it  is 
subject  to  tax  as  such.    Matter  of  Dows,  167  N.  Y.  227. 

(9.)  Where  real  property  is  conveyed  to  trustees 
with  power  to  sell  or  mortgage,  and  providing  that  at 
the  death  of  the  grantor  it  should  be  held  in  trust  for 
her  daughters,  each  daughter  being  given  power  to 
appoint  her  share  among  her  lawful  issue,  and  failing 
to  do  so,  her  share  to  belong  to  such  of  her  issue  as 
shall  survive  her.  Held,  on  the  death  of  a  daughter 
leaving  issue  and  not  having  exercised  her  power  of 
appointment,  that  the  transfer  of  the  share  of  the  de- 
ceased daughter  which  had  been  converted  into  per- 
sonalty, and  over  which  she  had  failed  to  exercise  such 
power,  was  subject  to  tax  under  Laws  of  1896,  chapter 
908,  section  220,  subdivision  5,  as  amended  by  chapter 
284,  Laws  of  1897,  although  as  real  estate  it  would  not 


POWER   OF    APPOINTMENT.  115 

have  been  taxable.    Matter  of  Bartow,  30  Misc.  Rep. 
27,  62  N.  Y.  S.  1000. 

(10.)  Remainders  created  by  exercise  of  power,  when 
they  are  absolute  and  vested,  are  subject  to  taxation 
at  the  time  of  the  transfer,  and  they  do  not  come 
within  the  exception  of  section  222.  Matter  of  Dows, 
167  N.  Y.  227;  Matter  of  Roosevelt,  143  N.  Y.  120,  dis- 
tinguished. 

(11.)  That  subdivision  5  of  section  220  is  not  re- 
pealed by  the  provisions  of  section  230,  as  amended 
by  chapter  76,  Laws  of  1899,  which  provides  for  the 
immediate  taxation  of  future  and  contingent  interests, 
and  therefore  the  taxation  of  a  remainder  interest  in 
which  a  power  of  appointment  is  involved  must  be 
suspended  until  such  power  is  exercised.  Matter  of 
Howe,  86  App.  Div.  287,  83  N.  Y.  S.  825;  affd.,  176 
N.  Y.  570 ;  overruling  Matter  of  Le  Brun,  39  Misc.  Rep. 
516,  80  N.  Y.  S.  486. 

(12.)  A  provision  in  the  will  of  a  donee  of  a  power 
of  appointment  directing  her  executors  to  repay  a  loan 
theretofore  made  to  her  out  of  the  property  in  respect 
to  which  the  power  of  appointment  was  given  con- 
stitutes, when  accepted  by  the  creditor,  a  taxable  trans- 
fer. Matter  of  Westurn,  152  N.  Y.  93,  and  Matter  of 
Gould,  156  N.  Y.  423,  followed;  Matter  of  Rogers,  71 
App.  Div.  461,  75  N.  Y.  S.  835;  affd.,  172  N.  Y.  617. 

(13.)  Surrogate  having  jurisdiction. —  When  prop- 
erty is  transferred  under  a  power  of  appointment  the 
surrogate  of  the  county  in  which  the  donee  of  the 
power  resided  at  the  time  of  death,  and  in  which  her 
will  was  admitted  to  probate,  has  jurisdiction  under 
section  229  (now  §  228)  to  determine  whether  the  trans- 


116  THE   LAW    OF    TAXABLE    TRANSFERS. 

fer  is  taxable.  Matter  of  Seaver,  63  App.  Div.  283,  71 
N.  Y.  S.  544. 

(14.)  That  it  is  the  exercise  of  the  power  of  appoint- 
ment and  not  the  creation  of  the  power  which  effects 
taxable  transfers,  and  therefore  there  is  nothing  tax- 
able until  the  power  is  exercised.  Matter  of  Howe,  86 
App.  Div.  286,  83  N.  Y.  S.  825;  affd.,  176  N.  Y.  570. 
Citing  Matter  of  Seaver,  63  App.  Div.  283,  71  N.  Y.  S. 
544;  Matter  of  Walworth,  66  App.  Div.  171,  72  N.  Y.  S. 
984. 

(15.)  When  the  exercise  of  a  power  is  in  contraven- 
tion of  the  statute  of  perpetuities,  the  estate  created 
under  such  power  must  be  referred  back  to  the  instru- 
ment granting  the  power.  Genet  v.  Hunt,  113  N.  Y. 
158;  Matter  of  Dows,  167  N.  Y.  227-231. 

(16.)  The  courts  have  never  passed  upon  the  pro- 
visions of  subdivision  5  in  reference  to  the  taxing  of  a 
transfer  under  a  power  where  the  donee  shall  omit  or 
fail  to  exercise  the  power  in  whole  or  in  part,  the  stat- 
ute providing  in  that  event  that  "  a  transfer  taxable 
under  the  provisions  of  this  act  shall  be  deemed  to  take 
place  *  *  *,"etc.  The  court,  in  the  Matter  of  Doivs, 
176  N.  Y.  at  p.  232,  states  that  where  a  fund  passes 
upon  failure  to  exercise  the  power,  that  they  express 
no  opinion  on  the  question,  whether,  under  such  cir- 
cumstances, the  tax  imposed  by  the  amendment  of 
1897  could  be  deemed  other  than  a  tax  on  the  property 
itself.  In  the  Matter  of  Lansing,  182  N.  Y.  238,  the 
court  says :  ' '  We  pass  without  serious  discussion  that 
part  of  the  statute  which  provides  m  substance,  that 
the  failure  or  omission  to  exercise  a  power  of  appoint- 
ment subjects  the  property  to  a  transfer  tax  in  the 


POWER   OF    APPOINTMENT.  117 

same  manner  as  if  the  donee  of  the  power  had  owned 
the  property  and  had  devised  it  by  will. ' ' 

125.  Decisions  Prior  to  the  Amendment  of  1897. 

Prior  to  the  amendment  of  1897  an  interesting  ques- 
tion arose  under  the  will  of  Cornelia  M.  Stewart  (131 
N.  Y.  274)  (Act  of  1885).  The  decedent  gave  a  legacy 
of  several  million  dollars  to  the  executor  in  trust, 
either  to  apply  the  same  to  the  erection  and  endowment 
of  a  certain  institution,  or,  at  his  option,  to  appoint 
any  part  of  this  trust  among  any  of  the  other  legatees 
named  in  the  will.  Several  years  after  decedent's 
death  the  executor  exercised  the  power  and  appointed 
over  two  millions  of  said  trust  fund  among  ten  of  the 
legatees  named  in  the  will.  These  legatees  contended 
that  the  sum  coming  to  each  of  them  respectively  un- 
der the  exercise  of  this  power  was  not  taxable,  first, 
because  until  the  power  was  exercised  the  legatees  had 
a  mere  possibility  of  interest  in  the  property,  and, 
second,  because  the  statute  at  that  time  contemplated 
the  taxation  only  of  such  interests  as  could  be  valued 
at  the  death  of  decedent. 

The  Court  of  Appeals  considered  the  question  as  to 
whether  the  property  so  appointed  passed  by  the  will 
of  the  testatrix  or  under  the  instrmnent  given  by  the 
executor  in  execution  of  the  power,  and  held  in  accord- 
ance with  previous  decisions  on  the  same  subject,  that 
the  parties  receiving  the  legacies  took  under  the  will 
and  not  under  the  power,  and  the  legacies  were  tax- 
able. The  court  held  further  that  the  property  should 
be  appraised  at  its  value  when  the  power  was  exer- 
cised. 


118  THE   LAW    OF    TAXABLE    TRANSFERS. 

In  the  Matter  of  Harbeck,  161  N.  Y.  211,  the  decedent 
died  several  years  prior  to  the  enactment  of  any  in- 
heritance or  transfer  tax  law,  leaving  a  large  amount 
of  money  in  trust  for  the  use  of  his  wife  during  life 
and  giving  her  power  to  appoint  the  principal  of  said 
trust  by  her  will,  and  failing  such  appointment  it 
should  go  according  to  the  statute  of  descent.  The 
widow  died  in  1896,  exercising  the  power  by  her  will. 
The  State  contended  that  because  the  tax  was  one 
upon  the  succession  and  was  imposed  when  that  right 
came  into  being  upon  the  death  of  the  widow,  and  be- 
cause in  effect  the  legatees  took  under  the  widow's  will 
and  not  under  the  will  of  John  H.  Harbeck,  that  the 
estate  was  taxable.  The  court  held  that  under  the  law 
as  it  existed  in  1896  the  property  passed  to  the  bene- 
ficiaries under  the  will  of  John  H.  Harbeck,  which 
took  effect  several  years  prior  to  the  passage  of  any 
transfer  tax  law,  and  therefore  was  not  taxable. 

Where  one  died  prior  to  the  existence  of  the  Trans- 
fer Tax  Law  and  gave  her  residuary  estate  to  her  hus- 
band for  life,  with  the  right  to  dispose  of  the  same  at 
his  death  by  will,  and  the  husband  died  after  the 
passage  of  the  Transfer  Tax  Act,  leaving  a  will,  by 
the  terms  of  which  he  directed  his  executors  to  keep 
his  deceased  wife's  estate  separate  from  his  estate,  and 
to  deliver  it  to  her  executors  to  be  administered  by 
them  under  the  provisions  of  her  will,  it  was  held  that 
the  husband  had  failed  to  exercise  the  power  of  ap- 
pointment and  that  the  legatees  took  under  the  wife's 
will,  and  not  under  the  will  of  the  husband,  and  as  the 
wife  died  prior  to  the  Transfer  Tax  Law  there  was  no 
tax  on  the  estate  so  passing.  Matter  of  Langdon,  153 
N.  Y.  6. 


CHAPTER  VII. 

Taxable     Transfers  —  Succession     Tax    Upon     the 
Transfer  of  Property. 

Nonresident  Decedents. 

(§  220,  Tax  Law.) 

"  When  the  transfer  is  by  will  or  Intestate  Law,  of  property  within 
the  State,  and  the  decedent  was  a  nonresident  of  the  State  at  the  time 
of  his  death."     Subdivision  2,  section  220,  supra. 


126.  Constitutionality  of  the  act. 

127.  History  of  the  law. 

128.  Personal  property  of  nonresi- 

dents not  removed  until 
after  1892. 

129.  Jurisdiction  of  the   surrogate. 

130.  Bonds     and     stocks     of     New 

York  corporations ;  distinc- 
tion between. 

131.  Bonds   and   stocks   of   foreign 

corporations  and  taxability 
of  United  States  bonds  be- 
tween 1892  and  1898. 

132.  Both    registered    and    coupon 

bonds  of  foreign  corpora- 
tions are  taxable  if  here. 

133.  Money  deposited  in  bank. 

134.  The  mere  right  to  a  legacy  or 

a  residuary  estate  is  not 
presently  taxable. 

135.  Legacy  payable  to  a  nonresi- 

dent who  died  before  re- 
ceiving it,  when  taxable. 

136.  Seat  or  membership  in   Stock 

Exchange. 

137.  Debts  owing  by  a  resident  to 

a  nonresident  constitute 
property  within  the  mean- 
ing of  the  statute. 

[1 


138. 


1 30. 


140 
141. 
142, 
143 
144 
145. 

146 
147 
148 
19] 


Notes  inventoried  at  par  must 
be  treated  as  valid  obliga- 
tions, although  some  were 
six  years  overdue. 
Money  deposited  with  trust 
company  where  company  is- 
sues certificate  of  deposit 
for  same  which  is  held  by 
nonresident  decedent  at  his 
domicile. 

Money  deposited  with  a  trust 
company. 

Life  insurance  policies  not 
taxable. 

Property  of  nonresident  with- 
out this  State. 

Legacy  to  a  nonresident  bene- 
ficiary is  taxable. 

Money  transitorily  here  not 
taxable. 

Money  in  savings  banks  or 
held  by  decedent's  attorney 
is  taxable. 

Money  deposited  by  a  creditor 
to  pay  debt  due  nonresident. 

When  debt  due  nonresident  de- 
cedent was  held  not  taxable. 

Loans  made  by  a  partner  to 
his  firm  are  taxable. 


120 


THE    LAW    OF    TAXABLE    TRANSFERS. 


149.  Debt    on   open   account   due   a 

nonresident  from  domestic 
associations. 

150.  Memoranda  of  decisions  as  to 

bonds  and  stocks. 

151.  Right  of  the  foreign  executor 

to  apply  decedent's  prop- 
erty in  payment  of  lega- 
cies. 


152.  Recognition   of   laws   of   other 

States    respecting    distribu- 
tion, etc. 

153.  Property    of    decedent    where 

community  law  prevails. 

154.  Residence  of  decedent. 

155.  Will  not  conclusive  as  to  resi- 

dence. 

156.  Proceedings  and  practice. 


126.  Constitutionality  of  the  Act. 

The  constitutionality  of  the  Succession  or  Transfer 
Tax  Law  of  this  State,  so  far  as  it  relates  to  the  right 
to  tax  the  transfer  of  the  property  of  a  resident  de- 
cedent, has  been  fully  and  clearly  established.  (Ante, 
p.  2,  and  cases  cited.)  And  the  right  includes  the 
personal  property  of  a  resident  decedent,  although 
such  property  was  not  within  this  State  at  the  time  of 
the  decedent's  death  {Matter  of  Swift,  137  N.  Y.  77- 
88),  for  our  courts  will  apply  the  maxim  mobilia  per- 
sonam sequuntur,  the  effect  of  which  is  to  make  the 
legal  situs  of  the  property  here  at  the  domicile  of  the 
decedent. 

But  in  the  case  of  a  nonresident  decedent  whose 
property  within  this  State  has  received  the  protection 
of  our  laws  and  our  courts,  equally  with  the  property 
of  a  resident  decedent,  the  courts  hold  that  the  legal 
fiction  must  give  way  to  the  actual  facts,  and  will  re- 
fuse to  apply  the  maxim,  the  effect  of  which  would  be 
to  defeat  the  right  of  the  State  to  impose  a  succession 
tax  upon  "  property  within  the  State  "  belonging  to 
a  nonresident  decedent.  Matter  of  Romaine,  127  N. 
Y.  80-87;  Matter  of  Whiting,  150  N.  Y.  27. 

In  Blackstone  v.  Miller,  188  U.  S.  189,  the  validity 


NONRESIDENT    DECEDENTS.  121 

of  a  tax  upon  the  transfer  of  moneys  left  by  a  nonresi- 
dent in  a  bank  in  New  York  city  was  upheld.  Justice 
Holmes,  writing  the  opinion,  says : 

Succession  to  a  tangible  chattel  may  be  taxed  wherever 
the  property  is  found,  and  none  the  less  that  the  law  of  the 
situs  accepts  its  rules  of  succession  from  the  law  of  domicile, 
or  that  by  the  law  of  domicile  the  chattel  is  a  part  of  a  uni- 
cersitas,  and  is  taken  into  account  again  in  the  succession 
tax  there. 

No  doubt  this  power  on  the  part  of  two  States  to  tax 
on  different  and  more  or  less  inconsistent  principles  leads 
to  some  hardship.  It  may  be  regretted,  also,  that  one  and 
the  same  State  should  be  seen  taxing  on  the  one  hand  accord- 
ing to  the  fact  of  power,  and,  on  the  other  hand,  at  the  same 
time  according  to  the  fiction  that,  in  succession  after  death, 
mobilia  sequuntur  personam  and  domicile  governs  the  whole, 
but  these  inconsistencies  infringe  no  rule  of  constitutional 
law. 

Power  over  the  person  of  the  debtor  confers  jurisdiction, 
we  repeat.  And  this  being  so,  we  perceive  no  better  reason 
for  denying  the  right  of  New  York  to  impose  a  succession 
tax  on  debts  owed  by  its  citizens  than  upon  tangible  chattels 
found  within  the  State  at  the  time  of  the  death.  The  maxim 
mobilia  sequuntur  personam  has  no  more  truth  in  the  one 
case  than  in  the  other.  When  logic  and  the  policy  of  the 
State  conflict  with  a  fiction  due  to  historical  traditions  the 
fiction  must  give  way. 

This  tax  did  not  impair  the  obligation  of  the  contract, 
and  does  not  deprive  the  plaintiff  in  error  of  any  of  the  privi- 
leges and  immunities  of  a  citizen  of  New  York. 

127.  History  of  the  Law. 

Chapter  483  of  the  Laws  of  1885,  in  effect  June  30th 
of  that  year,  did  not  impose  a  tax  upon  the  property 
of  a  nonresident  within  this  State  at  the  time  of  such 
decedent's  death.    Matter  of  Enston,  113  N.  Y.  174. 


122        THE  LAW  OF  TAXABLE  TRANSFERS. 

By  chapter  713  of  the  Laws  of  1887,  in  effect  June 
25th  of  that  year,  section  1  of  the  Act  of  1885  was 
amended  so  as  to  impose  a  tax  upon  the  property  of 
nonresident  decedents  within  this  State,  and  this 
amendment  first  came  up  for  construction  in  the  Mat- 
ter of  Romaine,  127  N.  Y.  80.  Worthington  Romaine 
died  September  27,  1888,  intestate,  and  a  resident  of 
Virginia,  his  next  of  kin  being  a  brother  and  sister, 
residing  in  this  State,  and  two  nephews  and  a  niece, 
who  were  nonresidents.  Decedent  was  lessee  of  a  box 
in  a  safe-deposit  company  in  New  York  at  the  time  of 
his  death  and  for  several  years  prior  thereto,  in  which 
he  kept  securities,  etc.  The  part  of  his  estate  so  in- 
vested and  kept  in  this  State  to  which  the  nephews  and 
niece  were  entitled,  being  one-third  of  the  whole 
amount,  was  appraised  at  $23,742.15. 

Contention  was  made  that  this  amendment  did  not 
apply  to  a  nonresident  intestate,  because  property 
"  which  shall  pass  *  *  *  by  the  intestate  laws  of 
this  State  "  is  expressly  mentioned  to  the  implied  ex- 
clusion of  property  passing  by  the  intestate  laws  of 
other  States,  and  that  this  act,  in  its  present  form,  was 
designed  to  meet  cases  of  succession  by  will,  but  not 
intestacy,  unless  the  decedent  was  a  resident. 

The  court  held  that  the  language  of  the  act,  as 
amended,  did  not  support  this  contention  when  the  en- 
tire section  is  read  as  a  whole,  and  that  property  of  the 
same  kind  situated  in  the  same  place,  receiving  the 
same  protection  from  the  law  and  administered  upon 
in  the  same  way  would  naturally  be  required  to  con- 
tribute toward  the  expenses  of  government  upon  the 
same  basis  regardless  of  whether  the  last  owner  died 


NONRESIDENT    DECEDENTS.  123 

testate  or  intestate.  The  order  assessing  the  tax  was 
affirmed. 

The  application  of  the  amendment  of  1887  was,  how- 
ever, limited  by  the  language  of  section  15,  which  pro- 
vided that  "  the  Surrogate's  Court  in  the  county  in 
which  the  real  property  is  situate  of  a  decedent  who 
was  not  a  resident  of  the  State  *  *  *  shall  have 
jurisdiction  to  hear  and  determine  all  questions  in  re- 
lation to  the  tax  arising  under  the  provision  of  this 
act,"  *  *  *  and  the  courts  thereafter  held  that, 
although  there  might  be  personal  property  of  a  non- 
resident decedent  within  this  State  at  the  time  of  his 
death,  which  clearly  came  within  the  terms  of  the 
amendment,  yet  it  could  not  be  taxed  unless  there  was 
real  property  also  belonging  to  such  decedent  upon 
which  the  jurisdiction  of  the  surrogate  could  be  based. 
Matter  of  Embury,  19  App.  Div.  214,  45  N.  Y.  S.  881; 
affd.,  154  N.  Y.  746.  No  opinion.  (In  the  Romaine 
Case  (supra),  it  did  not  appear  whether  the  decedent 
also  had  real  property  within  this  State  or  not.) 

No  attempt  was  made  to  remedy  this  jurisdictional 
provision  until  the  repeal  of  the  Collateral  Inheritance 
Act  in  1892,  and  the  enactment  of  chapter  399, 
Laws  of  1892,  in  effect  May  1st  of  that  year. 

128.  Personal  Property  of  Nonresidents    not  Removed  Until 
After  1892. 

After  May  1,  1892,  the  ownership  of  real  property, 
within  this  State,  by  a  nonresident  decedent,  was  not 
necessary  to  confer  jurisdiction  upon  the  surrogate, 
and  where  personal  property  of  a  nonresident  within 


124  THE   LAW    OF   TAXABLE    TRANSFERS. 

this  State  would  not  have  been  taxable  under  the  Act 
of  1887  it  did  not  become  taxable  under  the  Act  of 
1892,  although  allowed  to  remain  in  this  State  until 
after  the  Act  of  1892  went  into  effect.  Matter  of  Pettit, 
65  App.  Div.  30,  72  N.  Y.  S.  469;  affd.,  on  opinion  be- 
low, 171  N.  Y.  654. 

129.  Jurisdiction  of  the  Surrogate. 

Section  10  of  the  Act  of  1892  provided  that  the  sur- 
rogate having  jurisdiction  to  grant  letters  testamen- 
tary or  of  administration  upon  the  estate  of  a  dece- 
dent whose  property  is  chargeable  with  any  tax  under 
this  act  *  *  *  or  to  give  ancillary  letters  thereon, 
*  *  *  shall  have  jurisdiction  to  hear  and  determine 
all  questions  arising  under  the  provisions  of  this  act. 
The  Court  of  Appeals  in  the  Matter  of  Fitch,  160  N.  Y. 
87,  held  that  this  section  was  ample  to  confer  jurisdic- 
tion upon  the  surrogate  when  read  in  connection  with 
the  sections  of  the  Code  providing  for  the  granting  of 
letters  upon  a  decedent's  estate,  and  that  shares  of 
stock  in  a  corporation  of  this  State  held  by,  and  trans- 
ferred under  the  will  of  a  nonresident  was  ' '  property 
within  the  State  "  within  the  meaning  of  subdivision 
3  of  section  2476  of  the  Code ;  hence  the  surrogate  had 
by  force  of  said  section  10  jurisdiction  to  impose  the 
tax,  and  it  is  not  necessary  for  the  foreign  executor  to 
first  apply  for  ancillary  letters.  (Section  229  of  the 
Act  of  1896  refers  to  the  jurisdiction  of  the  surrogate 
and  this  provision  is  now  contained  in  section  228  of 
the  Act  of  1905.) 


NONRESIDENT    DECEDENTS.  125 

1 30.  Bonds  and  Stocks  of  New  York  Corporations  —  Distinc- 
tion Between. 

Distinction  is  made  between  the  taxability  of  the 
bonds  and  the  stocks  of  domestic  corporations  when 
owned  by  a  nonresident  decedent.  Matter  of  Bronson, 
150  N.  Y.  1. 

This  estate  consisted  partly  of  bonds  and  stocks  of 
domestic  corporations,  which  were  held  by  decedent  at 
his  residence  without  this  State  at  the  time  of  his  death. 
The  decedent  was  a  resident  of  Connecticut,  and  died  in 
1893;  therefore  proceedings  were  instituted  under 
chapter  399,  Laws  of  1892.  The  Appellate  Division 
held  that  the  executors  were  not  liable  to  pay  a  trans- 
fer tax  upon  the  basis  of  the  stocks  and  bonds  in  ques- 
tion. The  Comptroller  contended  that,  by  the  terms 
of  the  act  and  by  force  of  the  Statutory  Construction 
Law  of  the  State,  and  upon  the  theory  that  these  bonds 
and  shares  represent  interests  in  corporations  incor- 
porated under  the  laws  of  this  State,  they  were,  al- 
though not  physically  within  the  State,  properly  as- 
sessed for  the  purposes  of  such  taxation. 

The  court,  after  commenting  upon  section  1  of  the 
Transfer  Tax  Act,  and  particularly  the  wording  of  the 
act,  which  imposes  a  tax,  in  the  case  of  a  nonresident, 
upon  "  property  within  the  State,"  and  also  as  to  the 
definition  of  the  word  "  property  "  as  stated  in  sec- 
tion 22  of  said  act  (now  section  242  of  the  Act  of 
1905),  says  in  respect  to  the  bonds: 

Whatever  may  be  argued  in  support  of  the  right  to  sub- 
ject the  bonds  of  domestic  corporations  to  appraisement  for 
taxation  purposes  under  this  Act,  when  physically  present 


126  THE   LAW    OF    TAXABLE    TRANSFERS. 

within  the  State,  upon  some  theory  that  they  are  something 
more  than  the  evidence  of  a  debt  and  constitute  a  peculiar 
and  appreciable  species  of  property  within  the  recognition 
of  the  law  as  well  as  of  the  business  community,  such  argu- 
ment is  certainly  unavailing  in  this  case,  where  the  bonds 
themselves  were  at  the  owner's  foreign  domicile.  They  did 
not  represent  "  property  within  the  State  "  in  any  conceivable 
sense.  What  property  they  represented  consisted  in  the  debt 
of  their  maker  and  that  species  of  property  unquestionably 
must  be  considered  to  be,  as  a  chose  in  action,  the  holder's 
and  owner's,  and  to  be  inseparable  from  his  personalty.  The 
Supreme  Court  of  the  United  States  held  in  the  Foreign 
Held  Bonds  Case,  15  Wall.  300,  where  the  State  of  Penn- 
sylvania assumed  to  tax  the  interest  payable  upon  bonds 
issued  by  a  Pennsylvania  corporation,  secured  by  a  mort- 
gage upon  its  property  and  held  by  a  nonresident,  that  the 
tax  was  invalid.  *  *  *  But  debts  owing  by  corporations 
like  debts  owing  by  individuals,  are  not  property  of  the  debt- 
ors in  any  sense.  *  *  *  All  the  property  there  can  be, 
in  the  nature  of  things,  in  debts  of  corporations  belongs  to  the 
creditors,  to  whom  they  are  payable,  and  follows  their  domi- 
cile wherever  that  may  be.  Their  debts  can  have  no  locality 
separate  from  the  parties  to  whom  they  are  due.  * 
In  our  consideration  of  the  question,  we  should  not  lose  sight 
of  the  fact  that  the  State  through  the  Transfer  Tax  Act  is 
exerting  its  taxing  power  only  over  that  as  to  which  it  had 
jurisdiction  for  the  purpose  of  taxation.     *     *     * 

In  the  Swift  Case,  137  K  Y.  77,  *  *  *  the  Act 
of  1885  was  under  discussion,  and  the  general  theory  of  the 
Inheritance  Tax  Law  was  considered,  and  it  was  held  to  be  a 
fundamental  requirement  that  there  should  be  jurisdiction 
over  the  subject  taxed,  or  an  actual  dominion  over  the  subject 
of  taxation  at  the  time  the  tax  is  imposed.  *  *  *  It  is 
obvious  that  the  State  has  no  jurisdiction  over  a  right  of  suc- 
cession which  accrues  under  the  laws  of  the  foreign  State. 
That  is  something  in  which  this  State  has  no  interest,  and 
with  which  it  is  not  concerned.  The  legal  title  to  these 
bonds  or  the  debts  they  represent  vested  in  the  personal  rep- 


NONRESIDENT    DECEDENTS.  127 

resentatives  of  the  decedent  by  force  of  foreign  laws.  The 
decedent  was  a  creditor,  to  whom  the  obligors  in  the  various 
bonds  were  indebted,  the  extent  and  terms  of  whose  obligation 
were  evidenced  by  those  bonds.  The  legal  situs  of  the  in- 
debtedness was  at  the  creditor's  domicile,  and  as  the  actual 
situs  of  the  bonds  themselves  was  also  there,  upon  no  theory 
can  it  be  held  that  the  provisions  of  the  Transfer  Tax  Act 
could  reach  them  in  its  operation. 

But  with  reference  to  the  shares  of  capital  stock 
owned  by  the  decedent  the  court  reversed  the  Appel- 
late Division.     Judge  Gray  says: 

The  attitude  of  a  holder  of  shares  of  capital  stock  is 
quite  other  than  that  of  a  holder  of  bonds  toward  the  cor- 
poration which  issued  them.  While  the  bondholders  are 
simply  creditors,  whose  concern  with  the  corporation  is  lim- 
ited to  the  fulfillment  of  its  particular  obligation,  the  share- 
holders are  persons  who  are  interested  in  the  operation  of 
the  corporate  property  and  franchises  and  their  shares  actu- 
ally represent  individual  interests  in  the  corporate  enter- 
prise. The  corporation  has  the  legal  title  to  all  the  proper- 
ties acquired  and  appurtenant;  but  it  holds  them  for  the 
pecuniary  benefit  of  those  persons  who  hold  the  capital  stock. 
*  *  *  As  personalty,  the  legal  situs  does  follow  the  per- 
son of  the  owner ;  but  the  property  is  in  his  right  to  share  in 
the  net  produce,  and,  eventually,  in  the  net  residuum  of  the 
corporate  assets,  resulting  from  liquidation.  That  right  as 
a  chose  in  action  must  necessarily  follow  the  shareholder's 
person ;  but  that  does  not  exclude  the  idea  that  the  property, 
as  to  which  the  right  relates  and  which  is,  in  effect,  a  distinct 
interest  in  the  corporate  property,  is  not  within  the  jurisdic- 
tion of  the  State  for  the  purpose  of  assessment  upon  its 
transfer  through  the  operation  of  any  laws  or  of  the  act  of 
its  owner.  The  attempt  to  tax  a  debt  of  the  corporation  to  a 
nonresident  of  the  State  as  being  property  within  the  State 
is  one  thing,  and  the  imposition  of  a  tax  upon  the  transfer  of 
any  interest  in,  or  right  to,  the  corporate  property  itself  is 


128  THE    LAW    OF    TAXABLE    TRANSFERS. 

another  thing.  The  corporation  is  the  creation  of  State 
laws,  and  those  who  become  its  members  as  shareholders  are 
subject  to  the  operation  of  those  laws  with  respect  to  any 
limitation  upon  their  property  rights  and  with  respect  to  the 
right  to  assess  their  property  interests  for  the  purposes  of 
taxation. 

131.  Bonds  and  Stocks  of  Foreign  Corporations  and  Taxability 
of  United  States  Bonds  Between  1892  and  1898. 

The  taxability  of  bonds  and  stocks  of  domestic  and 
foreign  corporations  owned  by  nonresident  decedents 
deposited  in  this  State  was  considered  in  the  Matter 
of  Whiting,  150  N.  Y.  27,  the  court  holding  that  bonds 
of  foreign  as  well  as  domestic  corporations,  and  cer- 
tificates of  stock  of  domestic  corporations  (but  not 
United  States  bonds  or  certificates  of  stock  of  foreign 
corporations)  owned  by  a  nonresident  decedent,  but 
deposited  by  him  in  a  safe-deposit  vault  in  this  State, 
and  so  present  in  this  State  at  the  time  of  decedent's 
death,  are  subject  to  taxation  under  Act  of  1892. 

The  decedent  died  July  23,  1894,  a  resident  of  Rhode 
Island,  and  had  money  on  deposit  in  a  bank  in  this 
State,  and  certain  bonds  and  stocks  of  both  domestic 
and  foreign  corporations,  and  also  United  States 
bonds,  which  were  all  kept  in  a  box  rented  by  him  in 
a  safe-deposit  vault  in  this  State.  All  except  the 
stock  of  foreign  corporations  were  included  in  the 
appraisement,  which  was  sustained  by  the  surrogate 
and  by  the  Appellate  Division.  Judge  Vann,  in  writ- 
ing the  prevailing  opinion,  says: 

A  majority  of  my  associates,  however,  are  of  the  opinion 
that  the  United  States  bonds,  although  physically  present  in 


NONRESIDENT    DECEDENTS.  129 

this  State,  are  not  subject  to  a  transfer  tax.  By  their  direc- 
tion I  announce,  as  the  conclusion  of  the  court,  that  the 
certificates  of  stock  in  question  as  well  as  of  all  of  the  bonds, 
except  those  issued  by  the  United  States,  were  properly  held 
by  the  courts  below  subject  to  taxation  under  the  Transfer 
Tax  Act  on  account  of  their  physical  presence  in  this  State ; 
that  although  the  State  may  have  the  power  to  impose  a  suc- 
cession tax  upon  United  States  bonds,  it  has  not  yet  done 
so ;  that  the  phrase  property  *  *  *  "  over  which  this 
State  lias  any  jurisdiction  for  the  purpose  of  taxation  "  refers 
to  the  jurisdiction  actually  exercised  through  contemporary 
statutes,  rather  than  to  the  entire  jurisdiction  actually  pos- 
sessed by  the  State ;  that  hence  the  order  appealed  from 
should  be  so  modified  as  to  exempt  from  taxation  the  bonds 
owned  by  the  decedent  that  were  issued  by  the  United  States 


In  view  of  this  decision,  with  respect  to  the  non- 
taxability  of  United  States  bonds,  the  Legislature,  by 
chapter  88,  Laws  1898,  amended  section  242,  which 
defines  the  words  "  estate  "  and  "  property  "  by  omit- 
ting therefrom  the  words  "  over  which  this  State  has 
any  jurisdiction  for  the  purposes  of  taxation,"  since 
which  time  United  States  bonds  have  been  subject  to 
transfer  tax  the  same  as  other  personal  property. 

132.  Both  Registered  and  Coupon  Bonds  of  Foreign  Corpora- 
tions are  Taxable  if  Here. 

At  the  time  the  decision  In  re  Bronson  and  In  re 
Whiting  was  handed  down  by  the  Court  of  Appeals, 
the  same  court  held,  in  the  Matter  of  Morgan,  150 
N.  Y.  35,  that  bonds  of  foreign  corporations,  both 
registered  and  coupon,  owned  by  a  nonresident  dece- 
dent, but  habitually  kept  by  him  in  a  safe-deposit 
9 


130  THE   LAW    OF    TAXABLE   TRANSFERS. 

vault  in  this  State,  and  so  present  in  this  State  at  the 
time  of  the  decedent's  death,  are  subject  to  taxation 
under  the  Act  of  1892. 

In  this  case  also  the  stock  of  foreign  corporations 
was  excluded  from  the  appraisal,  while  the  bonds  of 
foreign  corporations  were  included,  and  the  court  held 
that  this  was  proper  under  the  Whiting  Case  {supra) ; 
that  there  was  no  distinction  between  the  two  cases 
except  that,  in  the  Whiting  Case  it  did  not  appear 
whether  the  foreign  bonds  were  registered  or  coupon, 
while  in  the  Morgan  Case  there  were  both  kinds. 

The  courts,  in  construing  the  law  as  it  existed  in 
1887,  did  not  follow  the  rule  established  in  the  Whit- 
ing and  Morgan  Cases  (supra)  in  respect  to  the  taxa- 
bility of  foreign  bonds  owned  by  a  nonresident,  but 
kept  within  this  State.  Matter  of  Gibbes,  84  App.  Div. 
510, 83  N.  Y.  S.  53 ;  aff d.,  176  N.  Y.  565,  without  opinion. 
In  this  case  the  testator  died  in  1888,  and  from  the 
provisions  of  decedent's  will  it  was  determined  that 
the  taxability  of  his  estate  could  not  be  determined, 
owing  to  certain  contingent  interests  in  remainder. 
These  interests  became  vested  in  1899,  and  a  proceed- 
ing was  commenced  to  fix  the  tax.  It  was  contended 
that,  under  the  Act  of  1887  (the  law  in  force  at  dece- 
dent's death),  the  bonds  of  a  foreign  corporation  pass- 
ing from  the  estate  of  a  nonresident  to  a  nonresident, 
although  such  bonds  were  within  this  State  at  the 
time  of  decedent's  death,  were  not  subject  to  tax. 
The  surrogate  held  they  were  taxable  (40  Misc.  Rep. 
581,  83  N.  Y.  S.  56)  under  the  decisions  In  re  Whiting 
(supra)  and  Matter  of  Morgan  (supra).     The  Appel- 


NONRESIDENT    DECEDENTS.  131 

late  Division  reversed  the  surrogate,  by  a  divided  court 
(three  to  two),  holding  that  the  Act  of  1892  was  much 
broader  in  its  terms  than  that  of  1887,  and  therefore 
the  two  cases  cited  above  were  not  controlling.  And 
the  Court  of  Appeals  affirmed  the  decision  of  the 
Appellate  Division. 

It  has  been  the  practice,  however,  in  all  cases  where 
the  decedent  died  since  the  Act  of  1892,  to  tax  the 
bonds  of  foreign  corporations  owned  by  a  nonresident 
decedent,  if  such  bonds  were  within  this  State  at  the 
time  of  his  death. 

133.  Money  Deposited  in  Bank. 

Matter  ofHoudayer,  150  N.  Y.  37. 

John  F.  Houdayer  died  May  21,  1895,  a  resident  of 
New  Jersey.  In  1876  he  opened  an  account  with  the 
Farmers'  Loan  &  Trust  Company  of  New  York  as 
trustee  under  the  will  of  Edward  Husson.  At  his 
death  the  balance  of  his  deposit  was  the  sum  of 
$73,715,  of  which  it  was  shown  that  $2,000  belonged  to 
the  trust  estate  and  the  balance  was  his  individual 
money.  The  Appellate  Division  held  that  individually 
the  decedent  occupied  no  contract  relation  toward  the 
company,  that  the  legal  relation  of  debtor  and  creditor 
existed  between  the  trust  company  and  the  decedent 
as  trustee,  and  as  such  the  debt  was  not  property 
within  this  State  within  the  meaning  of  the  Taxable 
Transfer  Act. 

The  Court  of  Appeals  reversed  the  Appellate  Divi- 
sion, stating  that,  under  the  view  of  the  Appellate 
Division,  it  would  enable  a  large  sum  of  money  in- 


132        THE  LAW  OF  TAXABLE  TRANSFERS. 

vested  and  left  in  this  State,  and  enjoying  the  protec- 
tion of  its  laws,  to  escape  taxation,  because  the  dece- 
dent had  voluntarily  commingled  his  own  funds  with 
those  of  an  estate  he  represented ;  that  while  the  rela- 
tion of  debtor  and  creditor  technically  existed,  prac- 
tically the  decedent  had  his  money  in  the  bank,  and 
could  come  and  get  it  when  he  wanted  it.     It  was  an 
investment  in  this  State  subject  to  attachment  by  cred- 
itors,  and  if  not  voluntarily  paid  he   could  compel 
payment  through  our  courts,  and  in  order  to  enforce 
those  rights  it  was  necessary  for  him  to  come  into  this 
State,  and  that,  conceding  the  deposit  was  a  debt  and 
that  it  was  intangible,  still  it  was  property  in  this 
State  for  all  practical  purposes,  and  in  every  reason- 
able sense  within  the  meaning  of  the  Transfer  Tax 
Act.    In  re  Romaine,  127  N.  Y.  80-89.    The  court  held 
further  that,  while  the  distribution  of  the  fund  belongs 
to  the  State  where  the  decedent  was  domiciled,  yet 
such  distribution  cannot  be  made  until  his  administra- 
tor has  come  into  this  State  to  get  the  fund,  and  might 
possibly  be  obliged  to  resort  to  the  courts  for  aid  in 
reducing  it  to  possession;  therefore  the  fund  has  a 
situs  here,  because  it  is  subject  to  our  laws.    ' '  A  rea- 
sonable test  in  all  cases  as  it  seems  to  me  is :    Where 
the  right,  whatever  it  may  be,  has  a  money  value  and 
can  be  owned  and  transferred,  but  cannot  be  enforced 
or  converted  into  money  against  the  will  of  the  per- 
son owning  the  right  without  coming  into  this  State, 
it  is  property  within  this  State  for  the  purpose  of  suc- 
cession tax."     A  majority  of  the  court  concurred  in 
the  result  reached  by  Vann,  J.,  who  wrote  the  opinion, 


NONRESIDENT    DECEDENTS.  133 

but  the  majority  of  the  court  were  of  the  opinion  that 
a  deposit  of  money  in  a  bank,  although  technically  a 
debt,  is  still  money  for  all  practical  purposes,  and  as 
such  is  taxable. 

134.  The  Mere  Right  to  a  Legacy  or  a  Residuary  Estate  is 
not  Presently  Taxable. 

In  the  Matter  of  Phipps,  77  Hun,  325,  28  N.  Y.  S. 
330;  affd.,  143  N.  Y.  641,  one  Elizabeth  Fogg,  a  resi- 
dent of  this  State,  made  a  will,  in  which  she  left  her 
residuary  estate,  consisting  of  real  and  personal  prop- 
erty, to  Hiram  Fogg,  of  Bangor,  Me.,  and  John  H. 
Phipps,  of  Boston,  Mass.  Phipps  died  in  Boston  be- 
fore the  estate  of  Elizabeth  Fogg  had  been  adminis- 
tered, leaving  a  will,  in  which  his  interest  in  the  estate 
passed  to  his  wife.  The  question  presented  was 
whether  the  interest  so  transferred  in  the  State  of 
Massachusetts  was  taxable  in  the  State  of  New  York. 
The  court  held  it  was  not,  for  the  reason  that  such 
interest  at  the  time  a  tax  was  attempted  to  be  im- 
posed had  not  been  ascertained  by  an  accounting  of 
the  executors,  and  until  that  had  been  done  the  legatee 
might  not  be  able  to  maintain  an  action  for  its  re- 
covery. 

A  somewhat  similar  question  arose  in  the  Mattel-  of 
Zefita,  167  N.  Y.  280.  In  that  case  Mrs.  Hayward,  a 
resident  of  Paris,  bequeathed  certain  personal  prop- 
erty in  this  State  to  her  daughter,  the  Countess  Zefita. 
The  day  the  will  of  Mrs.  Hayward  was  probated,  the 
Countess,  also  a  resident  of  Paris,  died,  and  the  Appel 
late  Division  held  that  the  only  question  to  decide  was 


134         THE  LAW  OF    TAXABLE  TRANSFERS. 

whether  this  property,  which  is  in  the  hands  of  the  ex- 
ecutor of  Mrs.  Hayward,  and  is  not  yet  administered 
upon,  is  now  to  be  subject  to  a  transfer  tax  against 
the  legatee  of  the  Countess  Zefita,  who  was  also  a  non- 
resident of  this  State.  The  Appellate  Division  (44 
App.  Div.  340-345,  60  N.  Y.  S.  927)  held  that  the  ques- 
tion must  be  decided  as  of  the  time  when  the  appraisal 
was  made,  and,  such  appraisal  having  been  made  be- 
fore the  Hayward  estate  had  been  administered,  that 
the  personal  property  represented  by  the  securities 
which  the  executor  of  Mrs.  Hayward  held,  but  which, 
upon  the  final  administration  of  that  estate,  would 
have  been  paid  over  as  the  legacy  bequeathed  to  the 
Countess  Zefita,  is  not  now  taxable.  The  Court  of 
Appeals  affirmed  this  decision,  saying:  "  We  are  of 
the  opinion  that  the  learned  Appellate  Division  made 
a  proper  disposition  of  the  case  at  bar     *  in 

view  of  the  situation  existing  at  the  time  the  tax  was 
imposed.  When  the  executor  of  Mrs.  Hayward,  the 
mother,  shall  have  accounted  and  ascertained  the 
amount  of  the  residuary  estate  in  his  hands  it  will 
be  his  duty  to  see  that  the  transfer  tax  is  adjusted 
and  satisfied  before  paying  over  the  residue  to  the 
legal  representatives  of  the  Countess." 

1 35.  Legacy  Payable  to  a  Nonresident    Who  Died  Before  Re- 
ceiving it,  When  Taxable. 

In  the  Matter  of  Robert  T.  Clinch,  180  N.  Y.  300, 
it  was  held  that,  where  the  will  of  a  nonresident  of 
this  State  has  been  admitted  to  probate  in  this  State 
and  securities  representing  the  interest  such  nonresi- 


NONRESIDENT    DECEDENTS.  135 

dent  had  in  the  estate  of  his  father,  who  was  also  a 
nonresident,  have,  since  the  legatee's  death,  come  into 
the  hands  of  his  executors,  and  are,  at  the  time  of  a 
transfer  tax  appraisal,  in  the  possession  of  such  execu- 
tors in  this  State,  the  securities  are  subject  to  the 
transfer  tax. 

Charles  J.  Clinch  (father  of  Robert)  died  July  22, 
1898,  a  resident  of  Paris,  and  his  will  was  duly  ad- 
mitted to  probate  by  the  surrogate  of  New  York 
county  September  6,  1898,  and  a  transfer  tax  was  paid 
upon  all  his  taxable  property  within  this  State.  Under 
that  will  the  son  Robert  was  entitled  to  one-fourth  of 
his  father's  residuary  estate,  subject  to  the  dower  of 
his  mother  in  the  real  estate  and  a  power  of  sale  given 
the  executors. 

Robert  T.  Clinch,  also  a  resident  of  Paris,  died 
April  12,  1899,  and  his  will  was  admitted  to  probate 
by  the  surrogate  of  New  York  county  February  23, 
1900. 

All  the  property,  real  or  personal,  within  the  State 
of  New  York,  which  was  owned  by  Robert  T.  Clinch 
at  the  time  of  his  death,  was  the  property  in  which 
he  was  interested  under  the  will  of  his  father. 

At  the  time  of  his  death  the  executors  of  the  father's 
estate  had  not  accounted  or  made  any  distribution  of 
the  personal  property  among  the  residuary  legatees 
mentioned  in  tlio  father's  will. 

After  the  death  of  Robert,  and  about  June  14,  1899, 
the  executors  of  the  father's  estate  distributed  and  set 
apart  for  the  estate  of  Robert,  and  as  the  equivalent 
of  his  interest  in  the  residuary  estate  of  his  father, 


136        THE  LAW  OF  TAXABLE  TRANSFERS. 

certain  securities  and  property,  consisting  of  stocks  of 
New  York  corporations,  bonds,  and  other  property 
within  this  State,  which  was  taxed  in  the  usual  transfer 
tax  proceedings  upon  the  estate,  by  order  entered  April 
20,  1903,  and  amounting  to  $21,729.36. 

The  Appellate  Division  affirmed  the  order  of  the 
surrogate  assessing  the  tax,  and  the  only  question  pre- 
sented upon  the  appeal  was  whether  the  property  re- 
ceived by  the  executor  of  Robert  T.,  after  the  death 
of  said  Robert  T.  Clinch,  from  his  father's  estate, 
was,  at  the  time  of  its  transfer  to  the  executor  of 
Robert  T.  Clinch,  personal  property  within  the  State 
of  New  York,  and  subject  to  transfer  tax  proceedings 
under  the  will  of  Robert  T.  Clinch. 

On  January  24,  1905,  the  Court  of  Appeals  affirmed 
the  decision  of  the  Appellate  Division,  stating  that  the 
appellant  contends  that,  at  the  time  of  Robert's  death, 
his  interest  in  his  father's  estate  was  a  mere  chose  in 
action,  the  situs  of  which  was  not  this  State,  but  at 
Robert's  domicile  in  France,  and  hence  was  not  prop- 
erty within  the  State  and  subject  to  our  inheritance 
tax  laws,  and  that  the  action  of  the  executor  subse- 
quent to  Robert's  death,  in  receiving  in  satisfaction  of 
that  chose  in  action  specific  securities  held  in  this 
State,  could  not  subject  the  property  to  our  inherit- 
ance tax  if  it  was  not  liable  to  tax  at  the  time  of 
Robert's  death.  Judge  Haight,  in  writing  the  opinion, 
says: 

We  may  concede  for  the  discussion  all  the  appellant 
claims  except  the  single  proposition  that  a  claim  due  a  non- 
resident from  a  resident  of  this  State  is  not  property  within 
this  State  subject  to  the  imposition  of  our  transfer  tax.      It 


NONRESIDENT   DECEDENTS.  137 

is  true  that  in  the  case  of  Matter  of  Phipps,  77  Hun,  325,  28 
N.  Y.  S.  330 ;  affd.  on  opinion  below,  143  N.  Y.  641,  Judge 
Van  Brunt  said  that  the  right  to  a  legacy  given  by  the  will 
of  a  resident  of  this  State  to  a  nonresident  could  not  be  con- 
sidered property  located  within  this  State.  Subsequently 
there  was  decided  by  this  court  four  cases,  Matter  of  Bron- 
son,  Matter  of  Whiting,  Matter  of  Morgan,  and  Matter  of 
Houdayer  (150  N".  Y.  1 ;  Id.  27 ;  Id.  35 ;  Id.  37),  all  arising 
under  the  Transfer  Tax  Law.  In  those  cases  it  was  held  that 
bonds  of  a  New  York  corporation  held  by  a  nonresident  and 
in  his  possession  at  the  place  of  his  domicile  at  the  time  of 
his  death  were  not  subject  to  the  tax,  but  that  deposits  in 
bank  in  this  State  were  so  subject.  In  the  Houdayer  Case 
Judge  Yann  placed  the  liability  of  deposits  in  bank  to  taxa- 
tion on  the  broad  ground  that  it  was  through  the  laws  and 
courts  of  this  State  that  their  repayment  could  be  enforced. 
The  majority  who  concurred  in  that  decision  did  not  deem  it 
necessary  to  go  so  far,  but  were  of  the  opinion  that  a  deposit 
in  bank  was  practically  the  same  as  actual  money.  In  Mat- 
ter of  Blackstone,  171  N\  Y.  682,  we  followed  the  decision 
in  the  Houdayer  Case  and  again  taxed  the  deposit  of  a  non- 
resident in  a  New  York  trust  company.  That  case  was  ap- 
pealed to  the  Supreme  Court  of  the  United  States  and  our 
decision  affirmed.  Blackstone  v.  Miller,  188  U.  S.  189. 
The  Supreme  Court  took  the  same  broad  ground  held  by 
Judge  Yann  in  this  court.  It  said  that  the  doctrine  that 
the  situs  of  personal  property  was  the  domicile  of  the  owner 
was  merely  a  fiction  which  must  yield  to  facts ;  that  it  was 
the  law  of  the  place  where  the  debtor  resided  which  gave 
the  debt  validity  and  forced  the  debtor  to  pay,  and  that  it 
was  within  the  constitutional  power  of  the  State  where  the 
debtor  resided  to  tax  the  obligation  from  him  to  a  non- 
resident excepting,  however,  the  case  of  bonds  and  negotiable 
instruments  which  are  considered  to  be  not  merely  evidence 
of  the  debt  but  inseparable  from  the  debt  itself.  This  de- 
cision was  but  the  logical  result  of  an  earlier  determination 
by  the  court  in  Chicago,  Rock  Island  &  P.  R.  Co.  v.  Stearns, 
174  U.  S.  710,  where  it  was  held  that  a  debt  due  from  a  resi- 


138         THE  LAW  OF  TAXABLE  TRANSFERS. 

dent  to  a  nonresident  would  be  seized  by  a  creditor  of  the 
latter  in  the  domicile  of  the  debtor.  Under  the  doctrine  of 
the  Blackstone  Case  the  interest  of  Robert  Clinch  in  his 
father's  estate  was  subject  to  the  inheritance  tax  imposed 
by  the  laws  of  this  State.     *     *     * 

Bartlett,  J. : 

I  vote  for  affirmance  and  the  opinion. 

This  court  held  in  Mattel'  of  Zefita,  Countess  De  Rohan- 
Chabot,  107  K.  Y.  280,  that  the  transfer  tax  could  not  be 
imposed  on  a  legacy  of  a  residuary  estate  until  the  amount 
of  that  estate  is  ascertained.  The  parties  in  interest  in  that 
case  were  all  nonresidents. 

In  the  case  at  bar  the  transfer  tax  was  imposed  after  the 
amount  of  the  residuary  estate  had  been  ascertained,  and 
clearly  falls  within  the  law  as  laid  down  in  the  case  cited. 
In  the  case  before  us  the  parties  are  also  nonresidents. 

The  nature  of  the  interest  of  a  residuary  legatee  prior  to 
a  final  accounting  of  the  executor  was  considered  in  Matter 
of  PUpps,  77  Hun,  325,  28  N.  Y.  S.  330 ;  affd.  on  opinion 
below,  143  N.  Y.  641. 

136.  Seat  or  Membership  in  Stock  Exchange. 

A  seat  or  membership  in  the  New  York  Stock  Ex- 
change of  a  nonresident  of  the  State  of  New  York, 
upon  the  death  of  such  nonresident,  is  subject  to  a 
transfer  tax  in  this  State. 

The  Court  of  Appeals  held,  in  People  ex  rel.  Lem- 
mon  v.  Feitner,  167  N.  Y.  1,  that  a  membership  or  seat 
in  the  New  York  Stock  Exchange  was  not  personal 
property  within  the  meaning  of  the  Tax  Law  (chap. 
908,  Laws  1896,  §  2,  subd.  4;  subd.  5,  as  renumbered 
by  chap.  490,  Laws  1901,  which  defines  the  terms 
"  personal  estates  "  and  "  personal  property  "),  and 
if  owned  bv  a  resident  of  the  State  would  not  be  tax- 


NONKESIDENT    DECEDENTS.  139 

able  thereunder,  and  since,  under  section  7  of  the  Tax 
Law,  the  property  of  a  nonresident  is  taxable  only  as 
personal  property  "  to  the  extent  "  as  if  owned  by 
a  resident,  it  is  not  taxable  when  owned  by  a  nonresi- 
dent; that,  although  the  value  of  a  seat  in  the  Stock 
Exchange  is  capital  invested  in  business  in  this  State, 
yet  it  is  not  taxable,  since  the  statute  referred  to  does 
not  cover  it.  In  the  Matter  of  Glendinning ,  68  App. 
Div.  125,  74  N.  Y.  S.  190;  affd.,  171  N.  Y.  684,  the 
executors  of  the  estate,  relying  upon  the  above  deci- 
sion, contended  that  the  transfer  of  a  seat  in  the  New 
York  Stock  Exchange  owned  by  the  decedent,  who  was 
a  nonresident,  was  taxable.  The  court  held  that,  while 
it  was  true  that  the  opinion  of  the  court  in  People 
ex  rel.  Lemmon  v.  Feitner  (supra)  shows  that  such  a 
seat  in  the  New  York  Stock  Exchange  is  not  personal 
property  under  the  restricted  definition  of  the  Tax 
Law  (chap.  908,  Laws  1896,  §  2,  subd.  5,  as  amended 
by  chap.  490,  Laws  1901),  "  yet  it  is  undoubtedly  capi- 
tal invested  in  business  in  this  State  which  has  a  mar- 
ket value  and  can  be  bought  and  sold."  As  was  said 
by  Mr.  Justice  Vann  in  the  opinion  in  the  case  cited: 
"  The  money  used  by  him  to  buy  his  seat  was  neither 
thrown  away  nor  given  away,  but  was  paid  for  prop- 
erty of  great  value,  which  was  the  main  instrumental- 
ity for  carrying  on  the  business  in  which  he  engaged. 
It  is  difficult  for  me  to  see  what  was  done  with  the 
money  unless  it  was  invested." 

The  taxability  of  the  "transfer  of  a  seat  in  the  Stock 
Exchange  was  again  raised  in  the  Matter  of  Hellman, 
77  App.  Div.  355,  79  N.  Y.  S.  201,  and  the  court  there 
held  that  all  that  passes  to  the  decedent's  personal 


140  THE   LAW    OF   TAXABLE   TRANSFERS. 

representatives  is  the  right  to  a  transfer  of  the  dece- 
dent's seat,  subject  to  the  rules  of  the  Stock  Exchange, 
and  not  the  capital  invested  in  the  purchase  of  the 
seat  or  the  value  thereof  at  the  time  of  the  decedent's 
death,  and  therefore  such  right  is  not ' i  personal  prop- 
erty "  within  the  meaning  of  subdivision  5  of  section 
2  of  the  Tax  Law. 

The  Court  of  Appeals  reversed  this  decision  (Matter 
of  Hellman,  174  N.  Y.  254),  Judge  Cullen  in  the  opin- 
ion saying: 

It  was  settled  that  under  the  law,  as  it  stood  prior  to  the 
Act  of  1896,  a  seat  in  the  exchange  was  subject  to  the  in- 
heritance or  transfer  tax  (Matte?-  of  Glendinning,  68  App. 
Div.  125 ;  affd.,  171  K  Y.  684)  ;  but  it  has  also  been  held 
that  it  would  not  be  assessed  for  annual  taxation.  People  ex 
rel.  Lemmon  v.  Feitner,  167  N.  Y.  1.  The  difficulty  in  the 
present  case  has  been  occasioned  by  the  revision  of  the  law 
and  the  consolidation  of  the  previous  legislation  into  a  single 
statute — the  Tax  Law  of  1896.  In  subdivision  5  of  section  2 
of  the  statute  is  given  the  definition  of  personal  property  as 
used  in  the  chapter  or  act.  It  is  a  reproduction  of  the  pro- 
visions of  law  then  in  force  regulating  general  taxation. 
Article  10  deals  with  "  taxable  transfers  "  or  inheritance  tax. 
By  section  220  of  the  statute  (the  first  section  of  the  article) 
it  is  enacted  that  a  certain  tax  shall  be  imposed  on  the  trans- 
fer of  any  real  or  personal  property  under  circumstances 
therein  enumerated.  The  majority  of  the  court  below  were 
of  opinion  that  the  definition  of  personal  property  already 
mentioned  controlled  the  provisions  of  this  article  and  that 
as  the  definition  did  not,  under  the  decisions  of  this  court, 
include  a  seat  in  the  exchange,  the  seat  was  not  subject  to  the 
transfer  tax.  If  the  statutory  scheme  of  taxation  were  an 
original  one  and  the  provisions  quoted  were  the  only  ones 
which  referred  to  the  subject-matter,  the  argument  of  the 
learned  Appellate  Division  would  be  cogent  and  probably 


NONRESIDENT   DECEDENTS.  141 

conclusive.  But  by  a  subsequent  section  of  the  article  on 
taxable  transfers  (§  242)  new  definitions  are  given  appli- 
cable to  the  transfer  tax  alone:  "  The  words  'estate'  and 
'  property '  as  used  in  this  article,  *  *  *  shall  include 
all  property  or  interest  therein,  whether  situated  within  or 
without  this  State."  That  a  seat  in  the  exchange  is  property 
and  passes  to  a  receiver  or  to  an  assignee  in  bankruptcy  has 
been  authoritatively  determined  by  the  decisions  of  both  this 
court  and  the  Supreme  Court  of  the  United  States.  Powell 
v.  Waldron,  89  1ST.  Y.  328;  Plait  v.  Jones,  96  N.  Y.  24; 
Hyde  v.  Woods,  94  IT.  S.  524;  Page  v.  Edmunds,  187  IT.  S. 
596.  In  the  Lemmon  Case  we  did  not  question  this  propo- 
sition, but  our  decision  proceeded  on  the  ground  that  the 
seat  did  not  fall  within  what  Judge  Vann  termed  "  the  some- 
what restricted  definition  of  the  tax  laws." 

In  determining  the  construction  to  be  given  to  the  broad 
and  comprehensive  language  of  section  242,  we  must  con- 
sider that  the  statute  has  a  history  plainly  indicating  the 
trend  of  legislative  action  and  that  as  to  the  transfer  tax 
it  is  a  literal  reproduction  of  the  then  existing  law.  First 
enacted  in  1885  (chap.  483),  the  Inheritance  Tax  Law  was 
limited  to  property  passing  to  collateral  relatives.  It  was 
subjected  to  repeated  amendments,  the  effect  of  which  in 
nearly  every  instance  was  either  to  enlarge  the  class  of  per- 
sons subject  to  the  tax  or  to  extend  its  application  to  some 
species  of  property  which  the  courts  had  held  not  to  fall 
within  its  terms.  The  distinction  between  property  justly 
subject  to  ordinary  taxation  and  that  liable  to  the  imposition 
of  the  transfer  tax  was  early  appreciated     *     *     *. 

Therefore,  because  section  242  prescribed  that  "  all  prop- 
erty "  shall  be  subject  to  the  transfer  tax  and  because  the  re- 
vision of  the  statute  should  not  be  held  to  work  a  change  in 
the  settled  law,  unless  the  legislative  intent  to  that  effect  is 
clearly  manifest,  we  are  of  the  opinion  that  the  seat  held  by 
the  testator  was  subject  to  the  tax  imposed  upon  it." 

See  also  Matter  of  Curtis,  31  Misc.  Rep.  83,  64  N.  Y. 
S.  574. 


142        THE  LAW  OF  TAXABLE  TRANSFERS. 

1 37,  Debts  Owing  by  a  Resident  to  a  Nonresident    Constitute 
Property  Within  the  Meaning  of  the  Statute. 

In  the  Matter  of  Daly,  100  App.  Div.  373,  it  appears 
that  the  decedent  died  at  the  city  of  New  York  Novem- 
ber 12,  1900,  but  was  a  resident  of  Montana,  and  his 
will  was  duly  probated  in  that  State  January  19,  1901. 

The  decedent  owned  at  the  time  of  his  death  the 
following  personal  property,  which  the  Comptroller 
claims  is  subject  to  our  Transfer  Tax  Law: 

Leasehold  estate  of  New  York  city  property, 

valued  at   $5,000  00 

On  deposit  in  Wells-Fargo  Bank,  New  York.  81,036  73 
On  deposit  in  National  City  Bank,  New  York.  197,995  58 
On  deposit  in  National  City  Bank,  Special, 

New  York , 1,300,518  91 

On  deposit  with  FloAver  &  Co.,  Bankers,  New 

York 263,094  71 


The  surrogate  of  New  York  county  held  that  the  last 
two  items  above  were  not  subject  to  tax,  and  it  is  from 
this  that  the  Comptroller  appeals. 

When  Mr.  Daly  went  to  Europe,  in  April,  1900,  the 
testimony  shows  that  William  Rockefeller,  of  New 
York  city,  owed  him  a  balance,  of  a  $2,000,000  loan, 
amounting  to  $1,212,500,  which  amounted  on  Novem- 
ber 1,  1900,  together  with  interest,  to  the  sum  of 
$1,300,518.91. 

Daly  returned  to  New  York  city  September  7,  1900, 
and  was  ill  at  the  time  and  never  recovered.  On 
November  1,  1900,  Mr.  Rockefeller  paid  by  check  his 
debt  and  interest,  amounting  to  $1,300,518.91,  as  above, 


NONRESIDENT    DECEDENTS.  143 

on  the  City  National  Bank,  and  gave  the  check  to 
Daly's  secretary,  John  C.  Lalor,  five  days  before 
Daly's  death,  at  which  time  Daly  was  incapable  of 
transacting  business,  knew  nothing  about  this  pay- 
ment, and  gave  no  directions  concerning  it. 

Lalor  took  the  check  to  the  National  City  Bank,  and 
at  the  instance  of  the  cashier  indorsed  it  "  Marcus 
Daly,  per  J.  C.  Lalor,"  and  the  cashier  gave  him  a 
book  in  which  the  bank  was  represented  as  indebted 
to  Daly  in  the  sum  of  $1,300,518.91,  "  Special  a/c," 
November  7,  1900,  and  it  remained  so  at  the  time  of 
Daly's  death,  November  12th. 

Daly  had  another  account  at  this  bank,  opened  about 
November  1,  1899.  (See  above.)  Lalor  testified  that 
he  had  no  power  of  attorney  to  transact  this  business, 
and,  further,  that  it  was  Mr.  Daly's  intention  to  put 
the  Rockefeller  money,  when  received,  in  his  own 
banking-house  in  Montana,  and  that  he  had  so  ex- 
pressed himself  to  the  witness. 

It  also  appears  by  the  testimony  that  an  account 
of  this  deposit  was  returned  in  the  inventory  in  Mon- 
tana and  a  tax  assessed  and  paid  on  it  there  under 
both  the  State  and  Federal  laws. 

As  to  the  other  contested  item,  the  deposit  with 
Flower  &  Co.,  it  appears  that  about  one  year  before 
his  death  he  had  deposited  with  that  firm  $250,000 
as  a  margin  with  which  to  protect  his  interest  in  the 
purchase  of  stock  of  the  Amalgamated  Copper  Com- 
pany, that  the  money  remained  on  deposit  and  was 
used  by  Flower  &  Co.  in  their  business,  and  at  the 
time    of    Daly's    death    amounted,    with    interest,    to 


144        THE  LAW  OF  TAXABLE  TRANSFERS. 

$263,094.71,  which  was  turned  over  to  the  Daly 
estate. 

The  surrogate  held  that  the  debt  from  Rockefeller 
was  not  paid  by  the  above  check,  and  that  the  deposit 
with  Flower  &  Co.  was  a  simple  debt  and  was  not 
taxable. 

The  Appellate  Division  reversed  the  order  of  the 
surrogate,  holding  that: 

If  these  two  sums  of  money  are  to  be  treated  as  cash  on 
hand,  subject  to  Daly's  order  at  the  time  of  his  death,  then 
they  were  taxable  within  the  rule  announced  in  Matter  of 
Houdayer,  150  K  Y.  37,  and  Matter  of  Blackstone,  69  App. 
Div.  127  ;  affd.  on  appeal  by  the  Court  of  Appeals,  171  N".  Y. 
682,  and  by  the  Supreme  Court  of  the  United  States,  sub 
nom.  Blackstone  v.  Miller,  188  U.  S.  189.     *     *     * 

Assuming,  however,  that  these  sums  of  money  be  treated 
as  debts  in  the  ordinary  sense  due  from  Rockefeller  and  from 
Flower  &  Co.,  we  think  they  constituted  property  within  the 
meaning  of  the  Transfer  Tax  Law  and  the  policy  of  the 
State  with  respect  thereto.  *  *  *  It  is  undisputed  that 
the  transfer  in  this  case  was  by  will ;  that  the  testator  was  a 
nonresident  of  the  State  at  the  time  of  his  death,  and  the 
subject-matter  of  the  transfer  was  a  debt  payable  by  ad- 
mittedly solvent  persons  residing  within  this  State  at  that 
time.  That  debts  constitute  property  cannot  be  gainsaid. 
In  what  it  consists  has  been  variously  defined.  Thus  in 
Ayers  v.  Lawrence,  59  N.  Y.  192-198,  Allen,  J.,  said: 
"  The  word  '  property '  denotes  the  interest  one  may  have  in 
lands  and  chattels  to  the  exclusion  of  others."  In  Hamil- 
ton v.  Rathbone,  175  IT.  S.  414,  it  was  said:  "The  word 
'  property '  *  *  *  is  broad  enough  to  include  every- 
thing which  one  person  can  own  and  transfer  to  another." 
In  Carlton  v.  Carlton,  72  Me.  115,  the  court  said:  "The 
word  '  property '  includes  choses  in  action  as  well  as  choses 
in  possession.       It  includes  money  due  as  well  as  money 


NONRESIDENT    DECEDENTS.  145 

possessed.  *     *     In  its  broadest  sense  it  includes  every- 

thing which  goes  to  make  up  one's  wealth  or  estate."  Powell 
v.  Waldron,  89  K  Y.  328.  In  the  Matter  of  Hellman,  174 
1ST.  Y.  254,  it  was  said,  in  speaking  of  this  section  of  the 
considered,  whether  it  is  such  as  might  be  taxed  under  the 
statute :  "All  property  having  an  appraisable  value  must  be 
general  law  or  not."     *     *     * 

In  Blachstone  v.  Miller  (supra),  the  Supreme  Court  of 
the  United  States  considered  this  question  and  the  policy 
of  this  law.  *  *  *  Therein  the  court  held  that  the  situs 
of  the  debt  at  the  place  of  residence  of  the  creditor,  where 
the  debtor  resided  in  a  foreign  jurisdiction,  was  based  upon 
a  fiction  of  law,  well  understood  and  historically  traceable, 
but  that  in  fact  the  situs  of  the  debt  was  at  the  place  of 
residence  of  the  debtor,  because  the  creditor  in  order  to  com- 
pel payment  of  the  debt  and  receive  the  money  was  required 
to  invoke  the  jurisdiction  and  the  laws  of  the  foreign  State ; 
that  being  compelled  to  resort  to  the  judicial  forum  in  such 
State  to  enforce  his  rights,  the  debt  within  the  policy  of  this 
statute  was  to  be  regarded  as  due  to  the  creditor  at  the  place 
where  the  debtor  resided,  and  where  alone  he  could  be  com- 
pelled to  make  payment,  and  that  under  such  circumstances 
the  fiction  of  the  situs  of  the  debt  as  of  the  residence  of  the 
creditor  could  not  obtain  as  against  the  policy  of  the  State  in 
imposing  the  tax.  *  *  *  Under  such  circumstances  the 
reasoning  of  the  Supreme  Court  of  the  United  States  be- 
comes controlling  and  proceeds  somewhat  beyond  a  determi- 
nation that  the  State  has  the  constitutional  right  to  tax  debts. 
It  not  only  determined  that  question  affirmatively,  but  it  also 
determined  that  under  the  statute  as  it  then  existed  debts 
were  taxable.     *     *     * 

These  views  necessarily  lead  to  the  conclusion  that  the 
order  of  the  surrogate  refusing  to  confirm  the  report  of  the 
referee  should  be  reversed.     *     *     * 

The  Court  of  Appeals  affirmed  the  decision  of  the 
Appellate  Division  on  the  opinion  below,  on  June  16, 
1905.    Matter  of  Daly,  182  N.  Y.  Mem. 
10 


146  THE   LAW    OF   TAXABLE   TRANSFERS. 

138.  Notes  Inventoried  at  Par  Must  be  Treated  as  Valid  Ob- 
ligations, Although  Some  Were  Six  Years  Overdue. 

In  the  Matter  of  Wall,  N.  Y.  Law  Journal  of  Jan. 
18,  1905,  the  surrogate  of  New  York  county  found  as 
a  matter  of  fact  that  the  decedent  was,  at  the  time 
of  his  death,  a  resident  of  the  State  of  Connecticut, 
and  held  therefore,  — ' '  The  appeal  of  the  executor 
must  be  sustained  to  the  extent  of  deducting  from  the 
appraisable  assets,  the  stock  owned  by  the  decedent 
in  a  foreign  corporation.  The  promissory  notes  made 
by  the  son  of  the  decedent,  who  is  now  the  executor, 
were  in  a  safe-deposit  box  in  this  State,  which  box 
was  in  the  joint  names  of  the  decedent  and  of  his  son. 
They  were  placed  there  at  the  request  of  the  decedent 
and  represented  a  debt  justly  due  him ;  they  were  thus 
in  his  possession  and  had  been  duly  delivered.  It  is 
stated  by  the  executor  that  there  were  mutual  trans- 
actions between  himself  and  his  father,  '  and  at  his 
death  I  happened  to  owe  him  $60,000  on  that  account/ 
and  the  notes  in  question  evidenced  that  debt.  In  the 
face  of  this  statement,  and  the  notes  being  set  out  at 
part  in  the  executor's  affidavit  of  assets,  and  in  the 
absence  of  any  averment  that  they,  or  some  of  them, 
were  barred  by  the  statute  of  limitations,  they  must 
be  treated  as  valid  obligations,  notwithstanding  the 
fact  that  some  of  them  were  more  than  six  years  over- 
due. Ross  v.  Ross,  6  Hun,  80.  No  suggestion  was 
made  that  the  maker  was  insolvent.  These  notes  were 
property,  having  a  situs  in  this  State,  and  must  be 
assessed  and  taxed  as  such.  Matter  of  Romaine,  127 
N.  Y.  80;  Matter  of  Whiting,  150  N.  Y.  27,  30;  Matter 
of  Horn,  39  Misc.  Rep.  133,  78  N.  Y.  S.  979." 


NONRESIDENT    DECEDENTS.  147 

The  Appellate  Division  of  the  First  Department 
affirmed  the  order  of  the  surrogate,  without  opinion. 
N.  Y.  Law  Journal  of  June  24,  1905. 

139.  Money  Deposited  With  Trust  Company  Where  Company 
Issues  Certificate  of  Deposit  for  Same  Which  is  Held 
by  Nonresident  Decedent  at  His  Domicile. 

In  the  Matter  of  Heivitt,  181  N.  Y.  Mem.  45,  the  de- 
cedent died  January  18,  1903,  a  resident  of  New  Jersey. 
At  the  time  of  his  death  he  had  on  deposit  in  the 
Morton  Trust  Company  of  New  York  City  the  sum 
of  $100,000,  for  which  said  company  had  issued  a  cer- 
tificate of  deposit  showing  the  receipt  of  said  money, 
upon  which  the  company  will  allow  interest  at  the 
annual  rate  of  3  per  cent,  from  date,  and  on  demand 
would  repay  the  like  amount  in  current  funds,  with 
interest,  "  to  the  said  Abraham  S.  Hewitt  or  his  as- 
signs on  the  return  of  this  certificate,  which  is  assign- 
able only  on  the  books  of  the  company." 

The  certificate  also  reserved  the  right,  upon  five 
days'  notice,  to  reduce  the  rate  or  discontinue  pay- 
ment of  interest  or  pay  the  principal. 

Decedent  also  had  on  deposit  in  the  United  States 
Trust  Company,  in  New  York  city,  $300,000,  for  which 
that  company  had  issued  a  certificate  similar  to  the 
one  mentioned  above. 

At  the  time  of  decedent's  death,  both  these  certifi- 
cates of  deposit  were  in  the  possession  of  decedent  in 
the  State  of  New  Jersey. 

In  transfer  tax  proceedings  upon  this  estate  the  ap- 
praiser reported  the  two  sums  of  money  in  said  trust 
companies   as  property   of  the   decedent  within    this 


148        THE  LAW  OF  TAXABLE  TRANSFERS. 

State,  and  an  order  was  accordingly  entered  by  the 
surrogate  of  New  York  county  assessing  a  tax  thereon. 
The  executors  and  legatees  appealed  from  this  order 
on  the  ground  that  the  property  of  which  the  decedent 
died  possessed  was  not  the  sums  of  money  so  deposited 
with  the  trust  companies,  but  the  two  certificates  of 
deposit  for  said  sums,  respectively,  and  that,  as  such 
certificates  were  in  New  Jersey  at  the  time  of  dece- 
dent's death,  neither  the  money  so  deposited  nor  the 
certificates  were  taxable  under  the  Transfer  Tax  Law 
of  this  State.  The  surrogate  affirmed  his  order  assess- 
ing the  tax  upon  said  two  sums  of  money,  and  this 
order  was  in  turn  affirmed  by  the  Appellate  Division 
of  the  First  Department,  without  opinion  (98  App. 
Div.  624,  90  N.  Y.  S.  1100),  and  the  order  of  the  Appel- 
late Division  entered  November  30,  1904,  was,  on  the 
25th  day  of  April,  1905,  affirmed  by  the  Court  of 
Appeals,  without  opinion. 

140.  Money  Deposited  With  a  Trust  Company. 

Money  deposited  with  a  trust  company  organized 
under  the  laws  of  the  State  of  New  York  to  the  credit 
of  a  resident  of  the  State  of  Illinois,  representing  the 
proceeds  of  the  sale  of  a  number  of  shares  of  stock  of 
an  Illinois  corporation  owned  by  such  resident  of  Illi- 
nois, is  subject,  upon  his  death,  to  a  transfer  tax  under 
the  laws  of  this  State. 

The  balance  of  a  deposit  account  kept  by  such  non- 
resident at  the  time  of  his  death  with  a  firm  of  bankers 
in  the  city  of  New  York  is  also  subject  to  tax.  Matter 
of  Blackstone,  69  App.  Div.  127,  74  N.  Y.  S.  508;  affd., 


NONRESIDENT    DECEDENTS.  149 

171  N.  Y.  682.  See  excerpt  from  decision  of  the  United 
States  Supreme  Court  in  Blackstone  v.  Miller,  at  page 
121. 

141.  I<ife  Insurance  Policies   not  Taxable. 

Policies  of  life  insurance  issued  by  a  life  insurance 
company  of  this  State  on  the  lives  of  nonresident  de- 
cedents, where  such  policies  are  not  within  the  State, 
have  been  held  not  subject  to  the  transfer  tax.  Matter 
of  Abbett,  29  Misc.  Rep.  567,  61  N.  Y.  S.  1067. 

Policies  by  which  domestic  corporations  insured  the 
life  of  a  nonresident  for  the  benefit  of  his  estate  which 
are  kept  in  the  State  of  New  York  and  which  were  here 
when  he  died  are  not  subject  to  the  transfer  tax  as 
they  cannot  be  deemed  property  capable  of  having  a 
situs  apart  from  the  person  of  the  payee.  Matter  of 
Horn,  39  Misc.  Rep.  133,  78  N.  Y.  S.  979. 

In  view  of  the  recent  decisions  in  the  Matter  of 
Hewitt  (p.  147),  and  the  Matter  of  Daly  (p.  142),  it  is 
not  clear  that  life  insurance  policies,  payable  to  the 
decedent,  or  his  estate  would  be  held  exempt  from 
taxation. 

142.  Property  of  Nonresident  Without  this  State. 

A  nonresident  executor  is  not  obliged  to  testify  be- 
fore the  appraiser,  in  reference  to  the  decedent's 
property  without  this  State,  or  the  stocks  of  foreign 
corporations  owned  by  the  decedent.  Matter  of  Bishop, 
82  App.  Div.  112,  81  N.  Y.  S.  474. 

143.  legacy  to  a   Nonresident  Beneficiary  is  Taxable. 
Where  the  beneficiaries  of  a  transfer  of  property 

within  this  State  by  a  resident,  by  a  grant  or  gift  in- 


150        THE  LAW  OF  TAXABLE  TRANSFERS. 

tended  to  take  effect  in  possession  or  enjoyment  at  or 
after  the  death  of  the  grantor  or  donor,  take  the  prop- 
erty under  the  laws  of  this  State,  it  is  not  important 
for  the  purposes  of  the  application  of  the  Transfer 
Tax  Act,  whether  they  reside  in  this  State  or  not  at 
the  time  of  the  imposition  of  the  tax.  Matter  of  Greene, 
153  N.  Y.  223-228. 

144.  Money  Transitorily  Here  not  Taxable. 

Moneys  which  a  nonresident  had  temporarily  on  de- 
posit within  this  State  for  three  days  before  his  death 
for  the  purpose  of  investing  them  in  the  stock  of  a 
foreign  corporation  are  not  subject  to  the  transfer 
tax,  although  the  decedent  died  before  the  transaction 
was  completed.  Matter  of  Leopold,  35  Misc.  Rep.  369, 
71  N.  Y.  S.  1032.  To  the  same  effect,  see  Matter  of 
Phillips,  N.  Y.  Law  Journal,  May  10,  1905,  in  reference 
to  the  amount  paid  on  subscription  for  Japanese  bonds, 
held  not  taxable. 

1 45.  Money  in  Savings  Banks  or  Held  by  Decedent's  Attorney 

is  Taxable. 

Moneys  of  a  nonresident  decedent  deposited  in 
savings  banks  in  this  State,  moneys  in  the  hands  of 
his  attorney  in  this  State,  and  bonds  secured  by  mort- 
gages on  lands  in  this  State  held  by  said  attorney,  are 
taxable  upon  the  death  of  such  decedent,  although  the 
property  is  also  taxable  in  the  State  of  the  decedent's 
domicile.  Matter  of  Burr,  16  Misc.  Rep.  89,  38  N.  Y.  S. 
811. 


NONRESIDENT    DECEDENTS.  151 

146.  Money  Deposited  by  a  Creditor  to    Pay  Debt  Due  Non- 

resident. 

A  deposit  in  a  bank  by  a  resident  debtor  of  rnoney 
to  meet  the  claim  of  a  nonresident  creditor  is  subject 
to  tax  upon  the  death  of  such  creditor,  it  appearing 
that  the  representatives  of  the  estate  accepted  such 
deposit  in  payment  of  the  debt.  Matter  of  Daly,  100 
App.  Div.  373;  afTd.,  182  1ST.  Y.  on  opinion  below. 

147.  When  Debt  Due    Nonresident    Decedent  was  Held  not 

Taxable. 

A  debt  due  a  nonresident  decedent  from  a  nonresi- 
dent debtor,  who  merely  did  business  as  a  banker  in 
the  State  of  Xew  York  and  payable  in  the  foreign 
State  of  the  common  residence  of  the  parties,  is  not 
subject  to  the  transfer  tax.  Matter  of  Bentley,  31 
Misc.  Rep.  656,  66  X.  Y.  S.  95. 

148.  Loans  Made  by  a  Partner  to  His  Firm  are  Taxable. 
Except  as  between  the  partners  themselves,  money 

which  one  of  them  loaned  to  the  firm,  which  it  used, 
and  upon  which  he  received  ratably  such  profits  as 
were  earned  by  the  firm,  is  invested  capital,  and  as 
such  is  subject  to  the  transfer  tax  upon  his  death. 
Calling  the  transaction  a  loan  does  not  transform  its 
character  as  an  investment  of  capital.  Matter  of 
Probst,  40  Misc.  Rep.  431,  82  N.  Y.  S.  396. 

149.  Debt  on  Open  Account  Due  a  Nonresident  from  Domestic 

Associations. 

A  debt  on  an  open  account  due  by  a  domestic  joint- 
stock  association  to  the  estate  of  a  nonresident  dece- 


152         THE  LAW  OF  TAXABLE  TRANSFERS. 

dent,  who  was  at  his  death  the  president  and  owner  of 
a  majority  of  the  stock  of  the  association,  is  not  sub- 
ject to  the  transfer  tax  for  the  reason  that  it  is  a  mere 
chose  in  action  whose  situs  is  the  domicile  of  the 
decedent.  Matter  of  Horn,  39  Misc.  Eep.  133,  78  N. 
Y.  S.  979. 

1 50.  Memoranda  of  Decisions  as  to  Bonds  and  Stocks. 

Bonds  accompanied  by  mortgages  on  New  York  real 
estate  which  were  owned  by  a  nonresident  and  within 
this  State  at  the  time  of  decedent's  death  were  held 
taxable.    In  re  Romaine,  127  N.  Y.  80-88. 

Bonds  of  the  United  States  were  taxable  (Wallace 
v.  Meyer,  38  Fed.  Eep.  184;  under  the  Act  of  1885, 
Matter  of  Sherman,  153  N.  Y.  1),  but  were  held  not 
taxable  under  Act  of  1892,  owing  to  the  wording  of 
section  22  of  said  act,  which  referred  to  the  definition 
of  the  word  "  property,"  as  such,  "  over  which  this 
State  has  any  jurisdiction  for  the  purposes  of  tax- 
ation." See  Matter  of  Whiting,  150  N.  Y.  27,  and  Mat- 
ter of  Sherman,  153  N.  Y.  1. 

By  chapter  88,  Laws  of  1898,  section  242  (formerly 
section  22),  was  amended  by  omitting  the  words  above 
quoted,  and  it  was  then  held  that  bonds  of  the  United 
States  were  taxable.  Matter  of  Plummer,  161  N.  Y. 
631.  This  case  was  taken  to  the  United  States  Su- 
preme Court  [Plummer  v.  Coler,  178  U.  S.  115),  and 
two  questions  presented  by  the  executors  of  the  estate. 

First.  That  an  inheritance  tax  upon  a  legacy  con- 
sisting of  United  States  bonds  came  within  the  very 
letter  of  the  United  States  statute,  which  declares  such 
bonds  to  be  exempt  from  taxation  in  any  form. 


NONKESIDENT    DECEDENTS.  153 

Second.  That  the  State  has  no  power  to  impose  any 
tax  which  would  have  the  effect  to  prevent  the  United 
States  government  from  borrowing  such  amounts  of 
money  as  it  might  require. 

The  court  held,  as  to  the  first  proposition,  that  the 
tax  was  not  a  tax  upon  the  United  States  bonds  which 
might  happen  to  compose  a  part  of  a  decedent's  prop- 
erty, but  was  a  tax  upon  rights  and  privileges  created 
and  regulated  by  the  State. 

As  to  the  second  contention  the  court  held  that  the 
unconstitutional  character  of  a  particular  tax  must  be 
shown  by  something  more  substantial  than  mere  con- 
jecture that  the  effect  of  the  tax  would  be  the  impair- 
ment of  the  borrowing  power  of  the  government. 

Bonds  of  domestic  corporations  owned  by  a  nonresi- 
dent, but  within  this  State  at  the  time  of  his  death  are 
subject  to  tax,  although  ancillary  letters  have  not  been 
issued  in  this  State.  Matter  of  Pullman,  46  App.  Div. 
574,  62  N.  Y.  S.  395. 

Bonds  of  foreign  corporations,  both  registered  and 
coupon,  physically  present  within  this  State  and  owned 
by  a  nonresident  at  the  time  of  his  death,  are  taxable. 
Matter  of  Whiting,  150  N.  Y.  27;  Matter  of  Morgan, 
150  N.  Y.  35. 

Bonds  secured  by  mortgages  on  New  York  real  es- 
tate and  owned  by  nonresidents,  where  such  securities 
were  held  out  of  this  State  at  the  time  of  decedent's 
death,  are  not  taxable.  Matter  of  Preston,  75  App. 
Div.  250,  78  N.  Y.  S.  91. 

Bonds  which  are  pledged  are  not  taxable,  as  the  title 
is  in  the  pledgee.  Matter  of  Pullman  (supra).  If, 
however,  the  indebtedness  is  discharged  before  the  ap- 


L54  THE   LAW    OF   TAXABLE    TRANSFERS. 

praisal  the  equity  in  the  property  pledged  would  be 
taxable.  Matter  of  Eurcomb,  36  Misc.  Rep.  755,  74 
N.  Y.  S.  475. 

Bonds  of  a  domestic  corporation,  owned  by  a  non- 
resident decedent,  and  not  within  this  State  at  the  time 
of  his  death,  are  not  taxable.  See  Matter  of  Bronson, 
150  N.  Y.  1. 

Bonds  of  a  foreign  corporation  kept  within  this 
State  by  a  nonresident  decedent,  under  the  statute  of 
1887,  were  not  taxable.  Matter  of  Gibbes,  84  App. 
Div.  510,  83  N.  Y.  S.  53;  affd.,  176  N.  Y.  565.  And  no 
change  in  this  respect  was  effected  by  the  amendment 
of  1891.  Matter  of  Lord,  N.  Y.  Law  Journal,  June  3, 
1905.  Since  1892  such  bonds  would  be  taxable  if  here 
at  the  time  of  decedent's  death. 

Id.;  as  to  Stock. 

Stocks  of  domestic  corporations  standing  on  the 
books  of  the  company  in  the  name  of  some  third  party 
at  the  time  of  death  are  taxable  as  the  property  of  the 
equitable  owner.  Matter  of  Neivcomb,  71  App.  Div. 
606,  76  N.  Y.  S.  222. 

Stocks  in  joint-stock  association.  An  attempt  was 
made  in  Matter  of  Jones,  172  N.  Y.  575,  to  distinguish 
between  the  stock  of  an  ordinary  corporation  and  that 
of  a  joint-stock  association.  In  this  case  the  assets  of 
the  association  (the  New  York  Times),  consisted 
largely  of  realty,  which  went,  under  decedent's  will,  to 
direct  heirs.  The  surrogate  held  the  shares  were  like 
other  shares  and  taxable.  The  Appellate  Division  re- 
versed this  decision,  and  they  were  in  turn  reversed  by 


NONRESIDENT   DECEDENTS.  155 

the  Court  of  Appeals,  which  held  that  the  distinction 
between  a  corporation  and  a  joint-stock  association  is 
one  more  in  degree  than  in  kind. 

Stocks  of  domestic  corporations,  subject  to  a  life 
estate,  given  by  a  nonresident  to  decedent's  mother 
with  remainder  to  a  niece  absolutely,  are  taxable.  Mat- 
ter of  Bushnell,  73  App.  Div.  325,  77  N.  Y.  S.  4;  affd., 
172  N.  Y.  649,  no  opinion. 

Stocks  of  national  bank.  Stock  in  a  national  bank, 
located  in  this  State  and  owned  by  a  nonresident  dece- 
dent, is  taxable  at  the  time  of  his  death,  although  the 
certificate  is  not  held  in  this  State.  Matter  of  Gush- 
ing, 40  Misc.  Eep.  505,  82  N.  Y.  S.  795. 

Stocks  of  a  New  York  corporation  owned  by  a  non- 
resident decedent  at  the  time  of  his  death  is  taxable, 
although  the  certificate  representing  such  shares  of 
stock  may  be  at  the  decedent's  domicile  without  this 
State.    Matter  of  Bronson,  150  N.  Y.  1. 

Stocks  of  domestic  corporations  owned  by  a  non- 
resident decedent  are  subject  to  the  tax,  although  an- 
cillary letters  have  not  been  issued  in  this  State.  Mat- 
ter of  Pullman,  46  App.  Div.  574. 

Stocks  of  foreign  corporations  owned  by  a  nonresi- 
dent, although  such  shares  are  within  this  State  at  the 
time  of  death,  are  not  taxable.  Matter  of  James,  144 
N.  Y.  6.    Decision  under  Act  of  1887. 

Stocks  held  by  pledgee.  In  such  case  title  is  deemed 
to  be  in  the  pledgee,  and  the  securities  are  not  taxable. 
Matter  of  Pullman,  46  App.  Div.  574,  62  N.  Y.  S.  395; 
Matter  of  Havemeyer,  32  Misc.  Rep.  416,  66  N.  Y.  S. 
722.    When  such  stock  is  redeemed  by  the  executor, 


156  THE   LAW    OF    TAXABLE    TRANSFERS. 

such  stock  then  becomes  subject  to  tax.     Matter  of 
Hurcomb,  36  Misc.  Rep.  755,  74  N.  Y.  S.  475. 

Reference  to  other  taxable  and  nontaxable  property  and  transfers, 
more  particularly  affecting  the  property  of  resident  decedents,  will  be 
found  under  chapters    XIV  and  XV. 

151.  Right  of  the  Foreign  Executor  to  Apply  Decedent's  Prop- 
erty in  Payment  of  Legacies. 

In  the  Matter  of  James,  144  N.  Y.  6  (decided  under 
the  Act  of  1887),  the  courts  conceded  the  right  of  a 
foreign  executor  to  pay  the  legacies  passing  to  col- 
lateral relatives  from  the  property  of  the  decedent  at 
his  domicile,  so  that  the  entire  assets  here  would  pass 
to  lineals  or  other  near  relatives,  the  court  saying: 
"  If  the  American  estate  is  appropriated  to  persons 
who  are  within  the  excepted  degree  of  relationship  to 
the  testator,  the  right  to  claim  the  tax  from  the  exec- 
utor is  gone.  It  does  not  lie  with  the  officers  of  the 
State  to  say,  in  such  a  case,  which  part  of  the  testator's 
property  shall  be  appropriated  to  the  payment  of  the 
legacies.  The  law  is  not  arbitrary  in  its  application. 
It  is  simply  absolute  in  its  requirements,  when  the  pre- 
cise case  arises,  which  it  was  framed  to  meet;  and 
where,  as  here,  the  case  is  not  presented  of  an  appro- 
priation of  any  part  of  the  American  estate  in  payment 
of  the  legacies  to  the  foreign  legatees,  this  special  Tax 
Law  cannot  and  should  not  apply." 

This  right  has  been  generally  recognized  and  allowed 
when  claimed  in  respect  to  the  payment  of  money  lega- 
cies where  the  estate  was  shown  to  be  ample,  but  the 
contention  and  practice  has  been,  since  1891,  to  tax 
proportionately  the  assets  within  this  State  where  the 


NONRESIDENT    DECEDENTS.  157 

decedent  died  intestate  or  his  residuary  estate  passes 
by  will  to  persons  in  both  the  1  and  5-per  cent,  class, 
if  the  property  here  equals  the  taxable  limitations. 

1 52.  Recognition  of  Laws  of  Other  States  Respecting  Distribu- 

tion, Etc. 

It  is  the  practice  in  assessing  the  tax  upon  the  trans- 
fer of  property  of  nonresident  decedents  to  recognize 
the  statutes  of  descent  and  distribution  of  other  States, 
where  the  decedent  died  intestate,  for  the  purpose  of 
determining  the  amount  passing  to  distributees  and 
the  rate  of  tax.  If  it  appears  that  the  statute  of  such 
foreign  State  is  different  from  our  statute  of  descent 
and  distribution,  the  rate  of  tax  is  governed  accord- 
ingly. 

153.  Property  of  Decedent  Where  Community  Law  Prevails. 

In  some  of  the  States  the  Community  Law  between 
the  husband  and  wife  prevails,  or  in  other  words,  all 
the  effects  which  both  husband  and  wife  possess  are 
presumed  common  effects  or  gains,  hence  when  either 
the  husband  or  wife  dies  all  the  properties  of  the  es- 
tate of  the  decedent  belong  first  to  the  community 
existing  between  the  husband  and  wife,  that  is,  the 
survivor  is  entitled  to  have  the  equal  one-half  of  the 
property  immediately  set  apart  to  her  as  absolutely 
her  own,  and  only  the  other  half  can  be  disposed  of  by 
will  of  the  decedent,  or  pass  under  the  statute  of  de- 
scent or  distribution  of  that  State. 

This  question  was  raised  before  one  of  the  ap- 
praisers of  New  York  county  in  the  Matter  of  Van 
Benthuysen  (not  reported;  appraiser's  report  filed  in 


158        THE  LAW  OF  TAXABLE  TRANSFERS. 

the  State  Comptroller's  office  June  2,  1902),  the  de- 
cedent being  a  resident  of  the  State  of  Louisiana, 
where  the  Community  Law  prevails,  the  executor 
claiming  in  his  affidavit  before  the  appraiser  that  "  un- 
der the  laws  of  the  State  of  Louisiana  the  widow,  who 
in  this  case  survived  the  decedent,  is  regarded  as  the 
owner  of  one-half  of  all  property  acquired  during  the 
marriage,  and  hence  she  does  not  take  this  one-half 
under  the  will  or  by  intestate  laws,  but  is  the  absolute 
owner  of  the  same  in  her  own  right,"  and  therefore 
only  one-half  of  the  property  owned  in  the  name  of  the 
decedent  and  within  this  State  at  the  time  of  his  death 
was  subject  to  our  Transfer  Tax  Law. 

The  decedent's  estate,  consisting  of  shares  of  stock 
of  New  York  corporations  and  money  deposited  in 
banks  in  the  State,  amounted  to  over  $100,000.  The 
appraiser  in  this  case  reported  the  whole  estate  as 
subject  to  taxation  and  the  order  of  the  surrogate  was 
entered  June  3,  1901,  assessing  the  tax  thereon,  from 
which  no  appeal  was  taken. 

The  practice,  however,  since  this  decision  has  been 
to  recognize  the  community  laws,  where  such  laws  pre- 
vail in  the  State  of  the  decedent's  domicile. 

154.  Residence  of  Decedent. 

It  occasionally  happens  that  the  question  of  a  dece- 
dent's residence  is  raised  in  transfer  tax  proceedings 
upon  his  property  within  this  State  and  the  general 
practice  has  been  for  the  appraiser  to  take  proof  of 
the  facts  offered  by  the  representatives  of  the  estate 
and  also  the  representative  of  the  State  Comptroller 
and  submit  his  report  and  appraisal  to  the  surrogate 


NONRESIDENT   DECEDENTS.  159 

with  a  finding  as  to  the  decedent's  residence  or  non- 
residence,  from  which  report  and  finding  and  the  order 
entered  thereon  by  the  surrogate  the  usual  appeal  can 
be  taken  by  any  interested  person. 

In  the  Matter  of  Bishop,  82  App.  Div.  112,  81  N.  Y. 
S.  474,  the  question  of  decedent's  residence  arose,  and 
the  executor  at  a  hearing  before  the  appraiser  was 
asked  to  furnish  for  the  State  a  full  and  complete  in- 
ventory of  the  estate  of  decedent,  and  also  to  answer 
the  question  as  to  what  stocks  of  corporations,  not 
organized  under  the  laws  of  this  State,  the  decedent 
owned.  The  executor  refused  to  comply  with  either 
request,  claiming  that  the  decedent  was  a  nonresident, 
and  therefore  his  executor  could  only  be  required  to 
testify  as  to  the  property  of  said  decedent,  which  was 
subject  to  taxation  under  the  laws  of  this  State.  The 
surrogate  held  that  the  appraiser  had  the  right  to 
inquire  into  the  question  of  the  residence  of  the  dece- 
dent as  an  incident  to  his  authority  to  determine  and 
appraise  the  taxable  assets.  The  executor  appealed 
from  the  decree  directing  him  to  answer  certain  ques- 
tions relating  generally  to  the  property  of  decedent, 
and  the  Appellate  Division  held  that  if  the  executor  of 
the  decedent  denies  that  the  decedent  was  a  resident 
of  this  State,  the  court  has  no  power  until  the  question 
of  residence  has  been  determined  to  require  the  exec- 
utor to  disclose  what  stocks  of  foreign  corporations 
were  owned  by  the  decedent  at  the  time  of  his  death; 
that  it  will  not  do  to  say  that  the  matter  of  residence 
and  the  question  of  liability  of  particular  property  to 
taxation  may  be  considered  at  the  same  time,  and  that 
it  is  an  inversion  of  the  whole  proceeding  to  say  that 


1()0  THE    LAW    OF    TAXABLE    TRANSFERS. 

one  must  answer  before  lie  is  before  the  court  in  a 
position  which  requires  him  to  answer,  and  that  before 
he  is  subject  to  an  inquiry  as  to  these  particular  assets 
he  should  be  brought  within  the  meaning  and  intent  of 
the  law,  by  having  it  established  that  the  testator  was 
a  resident  and  not  a  nonresident.* 

It  would  seem  therefore,  in  view  of  the  foregoing 
decision,  that  whenever  the  question  of  residence 
arises  and  the  executors  refuse  to  answer  any  in- 
quiry as  to  the  decedent's  whole  personal  estate,  the 
facts  should  be  reported  to  the  surrogate  by  the  ap- 
praiser and  the  proceedings  held  until  the  question  of 
residence  has  been  decided  by  the  surrogate,  after 
which  the  appraisal  proceedings  could  be  continued. 
The  statute,  however  (§  231  of  the  Act  of  1896, 
now  §  230  of  the  Act  of  1905),  seems  broad  enough 
to  confer  authority  upon  the  appraiser  to  deter- 
mine this  question  in  the  first  instance,  as  he  is 
directed  not  only  to  issue  subpoenas,  compel  witnesses 
to  attend  before  him,  take  the  evidence  of  such  wit- 
nesses under  oath  and  report  the  same  in  writing  to 
the  surrogate,  but  he  is  also  directed  to  report  "  such 
other  facts  in  relation  thereto,  and  to  said  matter,  as 
the  surrogate  may  order  or  require,"  and  the  general 
practice  has  been  for  the  appraiser  to  take  the  proof 
in  relation  to  the  decedent's  residence  and  report  the 
same,  with  his  conclusions,  to  the  surrogate. 

In  the  Matter  of  Singer,  105  App.  Div.  ,  the  sur- 
rogate held  that  the  decedent  was  a  resident  of  New 
Jersey  and  the  tax  on  his  estate  was  assessed  accord- 

"  No  order  has  been  entered  as  yet  upon  the  Appellate  Division  de- 
cision in  the  Bishop  Case,  but  as  soon  as  one  is  entered  an  appeal  will 
be  taken  to  the  Court  of  Appeals. 


NONRESIDENT    DECEDENTS.  161 

ingly.  The  Comptroller  contended  that  a  residence  or 
domicile  once  acquired  is  presumed  to  continue  until  it 
is  abandoned  and  another  residence  or  domicile  ac- 
quired elsewhere.  That  it  was  shown  before  the  ap- 
praiser that  Mr.  Singer  was  a  householder  in  this  State 
in  1891,  and  that  he  voted  in  this  State  in  1900.  In  his 
will  he  described  himself  as  ''of  the  city  of  New 
York;"  that  subsequent  to  1891,  and  up  to  the  time  of 
his  death  in  September,  1902,  he  opened  accounts  in  a 
number  of  savings  banks  in  New  York  city,  giving  his 
residence  to  the  officers  of  the  banks  as  Hotel  Savoy, 
New  York  city ;  that  while  he  spent  a  portion  of  each 
year  at  Atlantic  City,  N.  J.,  yet  he  never  acquired 
a  legal  residence  there  sufficient  to  constitute  an 
abandonment  of  his  New  York  residence.  The  Comp- 
troller further  contends  that  for  the  purposes  of  the 
transfer  tax,  domicile  and  residence  are  practically 
synonymous  terms. 

The  executors  contend  that  while  there  may  be  some 
evidence  that  Mr.  Singer  voted  in  New  York  in  1890, 
and  that  in  1890  he  lived  in  a  rented  house  in  New 
York,  yet  he  stated  at  that  time  that  New  York  was  no 
longer  his  legal  residence,  but  did  not  say  what  place 
he  claimed  as  his  residence.  The  Appellate  Division 
affirmed  the  order  of  the  surrogate,  without  opinion. 
This  case  will  doubtless  be  taken  to  the  Court  of 
Appeals. 

155.  Will    not  Conclusive  as  to  Residence. 

It  has  been  held  that  where  testator  had  a  home  in 

New  Jersey  that  he  was  a  nonresident  of  this  State, 

although  he  described  himself  in  his  will  and  codicils 
11 


162  THE   LAW    OF    TAXABLE    TRANSFERS. 

as  a  resident  of  the  city  and  county  of  New  York. 
Matter  of  Rogers,  83  App.  Div.  642,  82  N.  Y.  S.  1113; 
affg.  surrogate's  decision  in  N.  Y.  Law  Journal,  Janu- 
ary 24,  1903. 

156.  Proceedings  and  Practice. 

Transfer  tax  proceedings  in  respect  to  the  property 
of  nonresident  decedents  are  generally  initiated  by  the 
State  Comptroller,  who  designates  some  attorney  to 
represent  him  in  said  proceedings. 

The  appraisal  is  usually  made  upon  the  affidavits  of 
the  representatives  of  the  estate,  and  other  necessary 
witnesses,  which  are  prepared  in  duplicate  and  at- 
tached to  the  reports  of  the  appraiser  with  all  other 
necessary  papers. 

In  the  majority  of  cases  the  nonresident  decedent 
owns  only  a  few  shares  of  stock  of  one  or  more  New 
York  corporations,  or  the  property  will  consist  of  de- 
posits in  various  savings  banks  in  the  State,  the  aggre- 
gate amount  of  all  of  which  is  less  than  the  taxable 
limitation.    (§  220.) 

In  such  cases  it  is  the  practice  at  present  for  the 
State  Comptroller  to  issue  written  consents  for  the 
transfer  of  the  stock  or  funds  deposited  in  banks,  upon 
the  foreign  executors  or  administrators  filing  in  the 
Comptroller's  office  at  Albany,  N.  Y.,  an  affidavit 
showing  the  facts  from  which  it  appears  that  the  estate 
is  exempt  from  taxation.  If,  however,  the  affidavit 
shows  a  taxable  estate,  proceedings  are  then  instituted 
by  the  State  Comptroller  before  the  surrogate  having 
jurisdiction  (§  228  of  the  Act  of  1905),  unless  the  for- 


NONRESIDENT    DECEDENTS.  163 

eign  executor  or  administrator  prefers  to  have  their 
own  attorney  institute  such  proceedings. 

When  the  tax  has  been  assessed  and  paid,  written 
consent  for  the  transfer  of  such  shares  of  stocks  or 
other  property  within  this  State  is  given  (§  227,  Act  of 
1905),  together  with  the  usual  final  duplicate  receipts 
mentioned  in  section  236. 

Separate  consents  are  issued  for  the  transfer  of  the 
shares  of  stock  of  each  corporation  or  deposit  of 
money,  etc.,  and  not  one  general  consent  covering  the 
stock  of  all  the  corporations,  or  other  property  within 
this  State. 

Where  the  transfer  is  desired  of  shares  of  stock  of 
foreign  corporations,  having  a  transfer  office  within 
this  State,  or  the  property  is  in  the  form  of  bonds 
which  were  not  physically  present  within  this  State  at 
the  time  of  the  decedent's  death,  consent  will  be  given 
for  such  transfers  as  soon  as  it  is  determined  whether 
the  decedent's  estate  is  taxable  or  not. 

It  is  not  necessary  for  the  foreign  executor  or  ad- 
ministrator to  apply  for  ancillary  letters  in  this  State 
in  order  to  confer  jurisdiction  upon  the  surrogate  of 
the  county  where  the  nonresident  decedent's  property 
was  at  the  time  of  his  death.  Matter  of  Fitch,  160  N. 
Y.  87-91. 


CHAPTER  VIII. 
Taxable  Transfers  —  Exceptions  and  Limitations. 


157.  Exceptions  and  limitations. 

158.  The  general  subject. 

159.  Limitations;  to  the  1-per  cent. 

class. 

160.  Limitations  to  the  5-per  cent. 

class. 

161.  Limitations  refer  to  the  aggre- 

gate   property    passing    to 
both  classes. 

162.  Exceptions;       adopted      chil- 

dren. 

163.  Adoption    under   the   laws    of 

another  State. 

164.  Children  of  an  adopted   child 

not  included. 

165.  Recital    in    will,    respecting; 

not  conclusive. 

166.  Not    included     in     legacy    to 

children,  in  case  of  father's 
death. 

167.  Mutually    acknowledged    rela- 

tion by  a  parent. 

168.  The  relationship  must  be  mu- 

tual. 


109.  The  relationship  can  be  estab- 
lished as  between  strangers 
in  blood. 

170.  Failure  to  show  relationship. 

171.  When    relationship    is    estab- 

lished. 

172.  Proof  of  relationship. 

173.  Beneficiary     is    a     competent 

witness. 

174.  Burden  of  proof. 

175.  Stepparent  and  stepchildren. 

176.  Relation  of  the  parties;   facts 

establishing. 

177.  Living    as    one    family;    does 

not. 

178.  Lineal  descendants. 

179.  When  the  word  "  children  "  is 

equivalent  to  "descendants." 

180.  Husband    of    a    daughter    in- 

cludes  "  widower." 

181.  Specifically  exempted. 

182.  Corporations     specifically    ex- 

empted by  the  Act  of  1905. 

183.  Decision  affecting  exemptions 

generally. 


157.  Exceptions  and  Limitations. 

[§  221,  Tax  Law.]  When  property  real1  or  personal3  or 
any  beneficial  interest  therein,  of  the  value  of  less  than  ten 
thousand  dollars,  passes  by  any  such  transfer  to  or  for  the 
use  of  any  father,  mother,  husband,  wife,  child,  brother, 


1.  Chap.  41,  Laws   1903  —  in  effect  March   16  of  that  year. —  First 
taxes  transfers  of  real  property  to  1-per  cent,  class. 

2.  Chap.  215,  Laws   1891  — in  effect  April  20  of  that  year. —  First 
taxes  transfers  of  personal  property  to  1-per  cent,  class. 

[164] 


EXCEPTIONS   AND   LIMITATIONS.  165 

sister,  wife  or  widow  of  a  son  or  the  husband  of  a  daughter, 
or  any  child  or  children  adopted3  as  such  in  conformity  with 
the  laws  of  this  state,  of  the  decedent,  grantor,  donor  or 
vendor,  or  to  any  child  to  whom  any. such  decedent,  grantor, 
donor  or  vendor  for  not  less  than  ten  years  prior  to  such 
transfer  stood  in  the  mutually  acknowledged  relation  of  a 
parent,4  provided,  however,  such  relationship  began  at  or  be- 
fore the  child's  fifteenth  birthday5  and  was  continuous  for 
said  ten  years  thereafter,  and  provided  also  that  the  parents 
of  such  child  shall  be  deceased  when  such  relationship  com- 
menced,6 or  to  any  lineal  descendant  of  such  decedent, 
grantor,  donor  or  vendor  born  in  lawful  wedlock,  such  trans- 
fer of  property  shall  not  be  taxable  under  this  act ;  if  real  or 
personal  property,  or  any  beneficial  interest  therein,  so  trans- 
ferred is  of  the  value  of  ten  thousand  dollars  or  more,  it  shall 
be  taxable  under  this  act  at  the  rate  of  one  per  centum  upon 
the  clear  market  value  of  such  property.7  But  any  property 
devised  or  bequeathed  to  any  person  who  is  a  bishop  or  to 
any  religious,8  educational,  charitable,  missionary,  benevo- 

3.  Chap.  713,  Laws  1887  —  in  effect  June  25  of  that  year. —  First  in- 
cluded an  adopted  child  in  the  1-per  cent,  class  of  taxable  persons. 

4.  Chap.  713,  Laws  1887  —  in  effect  June  25  of  that  year.— First 
contained  provision  relative  to  mutually  acknowledged  relationship. 
except  that  by  this  amendment  the  relationship  could  exist  between 
"  any  person  "  and  the  decedent,  instead  of  "  any  child  "  and  the  de- 
cedent. 

5.  Chap.  88,  Laws  1898  — in  effect  March  21  of  that  year. —  Pro- 
vided for  the  mutual  acknowledged  relationship  to  exist  only  between 
"  any  child  "  and  the  decedent,  providing  further  that  such  relationship 
must  have  begun  at  or  before  the  child's  fifteenth  birthday  and  been 
continuous  for  ten  years  thereafter. 

6.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year.— Added 
a  further  proviso  that  the  parents  of  such  child  shall  be  deceased 
when  such  relationship  commenced. 

7.  Chap.  41,  Laws  1903  — in  effect  March  16  of  that  year.— Changed 
the  phraseology  of  section  221  of  the  Act  of  1896,  to  read  as  above,  so 
as  to  include  real  as  well  as  personal  property  in  the  limitation  to  the. 
1-per  cent,  class. 

8.  Chap.  169,  Laws  1892  — in  effect  March  19  of  that  year.— First 
exempted  transfers  to  a  bishop  or  religious  corporation  by  adding  such 
provision  to  section  1,  Act  of  1885.  This  provision  became  a  part  of 
section  2  of  chapter  399,  Laws  of  1892,  in  effect  May  1st  of  that  year, 
and  was  continued  in  section  221  of  the  Act  of  1896.  The  words  "here- 
tofore or  hereafter"  bequeathed,  etc.,  which  gave  this  provision  a 
retroactive  effect,  were  omitted  by  chapter  368,  Laws  of  1905   {supra). 


166  THE    LAW    OF    TAXABLE    TRANSFERS. 

lent,  hospital  or  infirmary9  corporation  including  corpora- 
tions organized  exclusively  for  bible  or  tract  purposes10  shall 
be  exempted  from  and  not  subject  to  the  provisions  of  this 
act.  There  shall  also  be  exempted  from  and  not  subject  to 
the  provisions  of  this  act  personal  property  other  than  money 
or  securities  bequeathed  to  a  corporation  or  association  organ- 
ized exclusively  for  the  moral  or  mental  improvement  of 
men  or  women  or  for  scientific,  literary,  library,  patriotic, 
cemetery  or  historical  purposes  or  for  the  enforcement  of 
laws  relating  to  children  or  animals  or  for  two  or  more  of 
such  purposes  and  used  exclusively  for  carrying  out  one  or 
more  of  such  purposes.  But  no  such  corporation  or  associa- 
tion shall  be  entitled  to  such  exemption  if  any  officer,  mem- 
ber, or  employee  thereof  shall  receive  or  may  be  lawfully 
entitled  to  receive  any  pecuniary  profit  from  the  operations 
thereof  except  reasonable  compensation  for  services  in  effect- 
ing one  or  more  of  such  purposes  or  as  proper  beneficiaries  of 
its  strictly  charitable  purposes ;  or  if  the  organization  thereof 
for  any  such  avowed  purpose  be  a  guise  or  pretense  for 
directly  or  indirectly  making  any  other  pecuniary  profit  for 
such  corporation  or  association  or  for  any  of  its  members  or 
employees  or  if  it  be  not  in  good  faith  organized  or  con- 
ducted exclusively  for  one  or  more  of  such  purposes.11 

158.  The  General  Subject. 

Section  220  imposes,  in  certain  cases,  a  tax  of  5  per 
cent,  upon  the  transfer  of  property,  real  or  personal, 
of  the  value  of  $500,  or  over,  or  any  interest  therein 
or  income  therefrom,  in  trust  or  otherwise,  to  persons 

9.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  Also 
specifically  exempts  educational,  charitable,  missionary,  benevolent, 
hospital,  or  infirmary  corporations. 

10.  Chap.  458,  Laws  1901  —  in  effect  April  22  of  that  year.— Also 
exempted  "  corporations  organized  exclusively  for  bible  or  tract  pur- 
poses." 

11.  Chap.  458,  Laws  1901  —  in  effect  April  22  of  that  year.— Also 
added  the  provision  of  this  section  in  reference  to  the  exemption  of  per- 
sonal property  other  than  money  or  securities  bequeathed  to  certain 
corporations  therein  named. 


EXCEPTIONS   AND    LIMITATIONS.  167 

or  corporations  not  exempt  by  law  from  taxation  on 
real  or  personal  property,  except  as  otherwise  pre- 
scribed in  the  next  section. 

In  section  221,  certain  exceptions  and  limitations  are 
stated,  which  effects  the  taxability  of  all  transfers 
mentioned  in  the  preceding  section,  and  when  these 
two  sections  are  read  together  it  is  apparent  that  the 
statute  recognizes  two  classes  of  taxable  persons,  the 
transfers  to  whom  are  taxed  at  a  different  rate,  and 
also  two  limitations  respecting  the  value  of  the  estate 
transferred,  which  alone  determine  the  liability  of  the 
respective  transfers  to  taxation.  This  section  also  ex- 
empts from  the  provisions  of  the  act  all  transfers  to 
certain  persons  and  corporations  therein  named. 

159.  limitations  —  To  the  1-Per  Cent.  Class. 

Where  the  transfer  is  to  or  for  the  use  of  any  father, 
mother,  husband,  wife,  child,  brother,  sister,  wife  or 
widow  of  a  son,  or  the  husband  of  a  daughter,  or  any 
child  or  children  adopted  as  such  in  conformity  with 
the  laws  of  this  State,  of  the  decedent,  grantor,  donor, 
or  vendor,  or  to  any  child  to  whom  any  such  decedent, 
donor,  or  vendor,  for  not  less  than  ten  years  prior  to 
such  transfer,  stood  in  the  mutually  acknowledged  re- 
lation of  a  parent,  provided,  however,  such  relationship 
began  at  or  before  the  child's  fifteenth  birthday,  and 
was  continuous  for  said  ten  years  thereafter,  and  pro- 
vided also  that  the  parents  of  such  child  shall  be  de- 
ceased when  such  relationship  commenced,  or  to  any 
lineal  descendant  of  such  decedent,  grantor,  donor,  or 
vendor,  born  in  lawful  wedlock,  such  transfer  to  those 


]68  THE   LAW    OF    TAXABLE    TRANSFERS. 

named  shall  not  be  taxable  under  this  act,  if  the  prop- 
erty, or  any  beneficial  interest  therein  transferred,  is 
less  than  $10,000;  if  the  property  is  of  the  value  of 
$10,000  or  over,  the  transfers  are  then  taxable  at  1  per 
cent. 

160.  Limitations — To  the  5-Per  Cent.  Class. 

Any  transfer  to  a  transferee  other  than  those  men- 
tioned in  section  221  necessarily  come  under  the  pro- 
visions of  section  220,  which  provides  that  an  estate 
of  $500,  or  over,  is  taxable  at  5  per  cent.,  except  as 
otherwise  prescribed  in  section  221.  In  proceedings 
to  assess  the  transfer  tax  upon  the  estate  of  Herman 
M.  Peck,  late  of  New  York  county,  deceased,  an  appeal 
was  taken  June  23,  1905,  from  the  order  of  the  sur- 
rogate assessing  the  transfer  tax  upon  said  estate, 
upon  the  ground  that  the  tax  should  have  been  assessed 
at  1  per  cent.,  instead  of  5  per  cent.,  as  the  beneficiary 
was  the  grandmother  of  the  decedent  and  should  be 
classed  among  the  persons  named  in  the  first  sentence 
of  section  221. 

If  the  exceptions  and  exemptions  provided  by  the 
Transfer  Tax  Law  were  based  upon  the  degree  of  re- 
lationship of  the  legatee  to  the  decedent,  a  grand- 
mother is  certainly  nearer  in  relationship  to  a  deceased 
grandson  than  some  of  the  persons  named  in  section 
221  would  be,  but  in  view  of  the  fact  that  the  statute 
grants  exceptions  without  regard,  particularly,  to  the 
degree  of  relationship  of  the  legatee  to  the  decedent, 
it  is  difficult  to  see  how  the  appellant  can  succeed  upon 
this  appeal. 


EXCEPTIONS   AND   LIMITATIONS.  169 

161.  Limitations  Refer  to  the  Aggregate  Property  Passing  to 
Both  Classes. 

In  the  Matter  of  Fisher,  96  App.  Div.  133,  89  N.  Y.  S. 
102,  the  surrogate  of  Tompkins  county  construed  the 
amendment  to  this  section,  made  by  chapter  41,  Laws 
1903,  as  an  intent  on  the  part  of  the  Legislature  to 
change  the  rule  established  by  the  decisions  in  the 
Matter  of  Hoffman,  143  N.  Y.  327,  and  the  Matter  of 
Corbett,  171  N.  Y.  516,  respecting  the  definition  of  the 
word  "  property  "  in  section  242,  and  the  limitations 
referring  to  the  aggregate  estate  transferred  to  both 
classes  of  taxable  persons. 

The  decedent's  whole  estate  transferred  amounted 
to  $10,122.46,  three-quarters  of  which  passed  to  two 
brothers  and  one  sister  equally,  and  the  remaining  one- 
quarter  passed  to  five  nephews  and  nieces.  The  sur- 
rogate refused  to  tax  the  portion  of  the  estate  passing 
to  the  brothers  and  sister,  holding  that  the  statute,  as 
amended  by  chapter  41  (supra),  must  now  be  construed 
so  as  to  permit  a  tax  of  1  per  cent,  to  be  imposed  upon 
a  sum  passing  to  brothers  and  sisters,  in  the  event  only 
that  the  total  amount  passing  to  them,  as  a  class,  is 
equal  to  the  sum  of  $10,000,  however  large  the  estate 
may  be. 

The  Appellate  Division  held  that  this  amendment 
works  no  such  change  in  the  meaning  of  the  statute  as 
to  require  the  interpretation  the  surrogate  gave  it; 
that  the  Matter  of  Hoffman  {supra)  and  the  Matter  of 
Corbett  (supra)  are  still  authority,  requiring  the  word 
"  property,"  as  used  in  section  221,  to  be  construed 
as  that  word  is  defined  in  section  242,  and  that  the  only 


170  THE    LAW    OF    TAXABLE    TRANSFERS. 

change  effected  by  the  amendment  of  1903  was  that,  in 
estimating  the  value  of  the  property  passing,  real  prop- 
erty as  well  as  personal  property  should  be  considered. 

162.  Exceptions  —  Adopted  Children. 

The  word  "  children,"  as  used  in  section  1  of  the 
Act  of  1885,  did  not  include  an  adopted  child,  and 
therefore  a  devise  or  bequest  to  an  adopted  child  of  the 
testator  prior  to  the  amendment  of  1887  was  taxable. 
Matter  of  Miller,  110  N.  Y.  216;  Matter  of  Cager,  111 
N.  Y.  343. 

Since  chapter  713,  Laws  1887,  in  effect  June  25th 
of  that  year,  adopted  children  have  been  considered 
in  the  same  class  with  those  named  in  the  1-per  cent, 
class  of  taxable  persons. 

163.  Adoption  Under  the  Laws  of  Another  State. 

The  court  held  in  the  Matter  of  Butler,  58  Hun,  400, 
12  N.  Y.  S.  201 ;  affd.,  136  N.  Y.  649,  without  opinion, 
that  it  was  not  necessary  that  the  proceedings  for  adop- 
tion should  have  been  taken  under  the  laws  of  this 
State,  to  entitle  an  adopted  son  to  the  exception. 

164.  Children  of  an  Adopted  Child  not  Included. 

The  children  of  an  adopted  child  are  not  included 
within  the  exception.  Matter  of  Fisch,  34  Misc.  Rep. 
146,  69  N.  Y.  S.  493.  Citing  Matter  of  Moore,  90  Hun, 
162,  35  N.  Y.  S.  782. 

165.  Recital  in  Will,  Respecting  —  Not  Conclusive. 
Where  testator  gives  a  share  of  his  estate  to  "  my 

niece  and  adopted  daughter,"  naming  her,  the  ap- 
praiser must  take  proof  of  the  adoption,  as  the  mere 


EXCEPTIONS    AND    LIMITATIONS.  171 

recital  in  the  will  is  not  conclusive.     Matter  of  Fisch, 
34  Misc.  Rep.  146,  69  N.  Y.  S.  493. 

166.  Not  Included  in  Legacy  to  Children  in  Case  of  Father's 

Death. 

The  testator's  will  provided :  "  If  either  of  my  sons 
shall  die  before  my  wife,  (who  was  given  a  life  estate 
in  all  the  decedent's  property)  his  share  shall  go  to 
his  children,  and,  in  default  of  children,  to  my  surviv- 
ing children  and  the  children  of  such  of  them  as  may 
be  dead."  Held,  that,  upon  the  death  of  one  of  the 
sons  before  the  death  of  decedent's  wife,  leaving  only 
an  adopted  child,  such  adopted  child  was  not  the  son's 
child  within  the  meaning  of  the  clause  of  the  will 
above  quoted,  and  particularly  in  view  of  the  statute 
in  force  at  the  time  the  will  was  made  in  1888.  (§  10, 
chap.  830,  L.  1873,  amended  by  chap.  703,  L.  1887.) 
Matter  of  Hopkins,  102  App.  Div.  458. 

167.  Mutually  Acknowledged  Relation  of  a  Parent 

The  exception  in  favor  of  any  child  (prior  to  1898 
the  words  "  any  person  "  instead  of  "  any  child  " 
were  used),  to  whom  the  decedent,  grantor,  donor,  or 
vendor  stood  in  the  mutually  acknowledged  relation  of 
a  parent,  subject  to  the  provisions  contained  in  said 
section,  refers  only  to  a  transfer  from  such  a  parent 
to  the  child. 

It  would  seem  therefore  that  the  exception  would 
not  apply  where  a  transfer  was  from  a  child  to  such  a 
parent,  and  the  practice  undoubtedly  would  be  to  tax 
trans fors  of  this  nature. 


172        THE  LAW  OF  TAXABLE  TRANSFERS. 

1 68.  The  Relationship  Must  be  Mutual. 

While  the  courts  are  inclined  to  construe  the  statute 
liberally  in  favor  of  those  sought  to  be  brought  within 
its  provisions,  yet  the  existence  of  the  relation  in  each 
case  must  be  determined  from  the  facts  and  circum- 
stances surrounding  it,  as  there  is  no  fixed  rule  for 
such  determination  aside  from  the  fact  that  the  ac- 
knowledgment of  the  relationship  must  be  mutual. 

In  a  recent  case  (Matter  of  Davis,  98  App.  Div.  546, 
90  N.  Y.  S.  244)  it  was  held  that  the  essential  feature 
in  the  required  relation  is  that  it  must  be  mutually 
acknowledged  to  exist;  however  fervent  may  be  the 
affection  existing  between  the  parties;  however  close 
may  be  their  relations  as  members  of  the  same  family 
or  household ;  however  liberal  may  be  the  expenditures 
of  the  decedent  for  the  education,  maintenance,  and 
welfare  of  the  alleged  child,  the  latter  is  not  entitled 
to  the  exemption  unless  the  parties  mutually  recognized 
that  they  were,  in  effect,  parent  and  child. 

The  court  said  in  the  Matter  of  Butler,  58  Hun,  400- 
403:  "  The  word  '  mutual  '  in  this  statute  has  no  ab- 
struse signification.  It  means  and  requires  reciprocity 
of  action,  correlation,  and  interdependence,  and  finds 
its  best  illustration  and  application  in  the  relations  ex- 
isting between  parents  and  children  which  are  always 
mutual. ' '  See  also  Matter  of  Nichols,  91  Hun,  134-139, 
36  N.  Y.  S.  538;  Matter  of  Stilwell,  69  N.  Y.  St.  R,  381, 
34  N.  Y.  S.  1123. 

Recently,  in  the  Matter  of  Hanford,  not  reported,  but 
affirmed,  92  N.  Y.  S.  1127,  by  the  Appellate  Division  of 


EXCEPTIONS   AND   LIMITATIONS.  173 

the  Third  Department  on  opinion  below,  the  surrogate 
of  Schenectady  county  held  that,  where  the  testator 
and  his  niece,  in  referring  to  each  other,  had  always 
used  the  terms  "  Uncle  George  "  and  "  Laura,"  and 
the  uncle  in  his  will  referred  to  her  as  "  Laura  Han- 
ford  Briggs,  now  living  with  me,"  that  the  niece  was 
entitled  to  the  benefit  of  the  exception,  it  appearing 
that  she  entered  the  testator's  home  when  she  was  ten 
years  of  age,  and  from  that  time  until  the  testator's 
death,  a  period  of  twenty-four  years,  there  was  mutual 
affection,  protection,  discipline,  and  control,  paternal 
in  their  nature  on  the  part  of  the  uncle,  and  depend- 
ence, obedience,  and  respect,  filial  in  their  nature  on 
the  part  of  the  niece. 

In  one  of  the  earlier  cases  (Matter-  of  Spencer,  21 
N.  Y.  St.  R.  145-153,  4  N.  Y.  S.  395),  the  court,  in  com- 
menting upon  the  evidence  tending  to  show  whether 
this  relationship  had  existed  between  an  aunt  and  niece, 
said :  If  the  evidence  conclusively  shows  that  the  par- 
ties understood  their  relations  were  paternal,  and  they 
thus  lived  together  in  their  belief,  discharging  their 
duties  and  obligations  to  each  other  upon  the  theory 
that  such  relations  existed,  such  manner  of  life  is  a 
mutual  acknowledgment  of  the  relation  which  each  sus- 
tains to  the  other. 

1 69.  The  Relationship  Can  be  Established  as  Between  Strang- 
ers in  Blood. 

The  General  Term  of  the  First  Department,  in  the 
Matter  of  Hunt,  86  Hun,  232,  held  that  this  provision 
was  intended  to  apply  only  to  illegitimate  children,  for 


174        THE  LAW  OF  TAXABLE  TRANSFERS. 

the  reason  that  the  legitimate  child  was  mentioned  first 
in  the  act,  next  the  adopted  child,  "  and  next,  we 
think,  is  intended  to  be  mentioned  the  illegitimate  child 
who  has  been  for  ten  years  acknowledged  as  the  tes- 
tator's child,  and  such  acknowledgment  has  been  mu- 
tual, ' '  and  that  this  view  was  strengthened  by  the  fact 
that  immediately  following  this  was  the  words  "  or 
any  lineal  descendants  of  such  decedent 
born  in  lawful  wedlock." 

The  Court  of  Appeals,  in  the  Matter  of  Beach,  154 
N.  Y.  242,  overruled  this  decision,  and  held  that  this 
exception  was  not  limited  to  illegitimate  children,  but 
extends  as  well  to  persons  not  of  the  blood  of  the  tes- 
tator, where  the  relationship  of  parent  had  been  mutu- 
ally recognized  for  ten  years  prior  to  the  testator's 
death. 

This  case  also  held  that  the  fact  that  the  legatee  was 
an  adult  at  the  inception  of  the  relationship  would  not 
exclude  the  legatee  from  this  provision,  as  the  words 
"  any  person  "  included  both  minors  and  adults.  In 
the  amendment  to  this  section  by  chapter  88,  Laws 
1898,  in  effect  March  28th  of  that  year,  the  word 
"  child  "  was  substituted  for  the  word  "  person," 
which  had  been  previously  used,  and  the  clause  pro- 
viding that  such  relationship  must  have  commenced 
at  or  before  the  child's  fifteenth  birthday,  and  be  con- 
tinuous for  ten  years  thereafter,  was  added. 

The  amendment  to  this  section  by  chapter  368,  Laws 
1905,  in  effect  June  1st  of  that  year,  further  provides 
that  the  natural  parents  of  such  child  must  be  deceased 
when  such  relationship  commenced. 


EXCEPTIONS   AND   LIMITATIONS.  175 

170.  Failure  to  Show  the  Relationship. 

Where  it  appears  that  the  parties  in  question  called 
each  other  and  were  known  as  uncle  and  niece,  instead 
of  father  and  daughter,  and  the  uncle,  upon  being  ap- 
pointed guardian  of  the  niece,  charged  her  support  and 
maintenance  against  the  income  of  the  niece's  prop- 
erty, which  he  would  not  have  been  entitled  to  do  if 
the  parties  really  sustained  the  relation  of  parent  and 
child,  the  niece  is  not  entitled  to  the  exception.  Matter 
of  Davis,  98  App.  Div.  546,  90  N.  Y.  S.  244.  See  also 
Matter  of  Dennison,  N.  Y.  Law  Journal  of  Aug.  17, 
1903. 

Where  an  aunt  took  charge  of  her  two  orphan  nieces, 
aged  five  and  ten  years,  respectively,  at  their  own  resi- 
dence, which  she  leased,  and  where  she  furnished  board 
to  them  at  high  rates,  the  aunt  charging  every  expense 
against  the  nieces'  separate  estate,  the  fact  that  she 
addressed  them  as  "  my  dear  girls  "  is  insufficient  to 
establish  the  aunt ' '  in  the  mutually  acknowledged  rela- 
tion of  a  parent  "  to  the  nieces,  so  as  to  except  them 
from  the  provisions  of  the  Transfer  Tax  Law,  upon 
legacies  from  the  aunt  to  said  nieces.  Matter  of  Bird- 
sail,  22  Misc.  Rep.  180-189,  49  N.  Y.  S.  450;  affd.,  43 
App.  Div.  624,  60  N.  Y.  S.  1133. 

171.  When  Relationship  is  Established. 

Where  a  child  was  taken  in  the  testator's  family 
when  six  years  old,  and  was  educated  and  supported 
by  the  testator,  and  continuously  resided  with  him 
until  he  died  fifty  years  later, —  held,  that  an  annuity 


176  THE   LAW    OF    TAXABLE    TRANSFERS 

to  her  of  $300  was  not  taxable,  although  the  testator 
designated  her  in  his  will  as  "  friend  "  instead  of 
"  daughter."  Matter  of  Wheeler,  1  Misc.  Kep.  450, 
22  N.  Y.  S.  1075.  See  also  Matter  of  Hanford,  at  page 
172. 

172.  Proof  of  Relationship. 

Where  an  executor  establishes  by  prima  facie  evi- 
dence, which  is  undisputed,  that  his  testator  stood  to 
the  residuary  legatee  in  the  mutually  acknowledged 
relation  of  a  parent,  the  tax  must  be  fixed  at  1  per  cent. 
Matter  of  Lane,  39  Misc.  Rep.  522,  80  N.  Y.  S.  381. 

173.  Beneficiary  is  a  Competent  Witness. 

In  the  Matter  of  Brundage,  31  App.  Div.  348,  52 
N.  Y.  S.  362,  the  court  held  that  the  beneficiary  was  not 
rendered  incompetent  by  section  829  of  the  Code  of 
Civil  Procedure  to  testify  in  regard  to  confidential  com- 
munications and  acknowledged  relations  growing  out 
of  an  agreement  between  him  and  the  decedent,  for 
the  purpose  of  showing  the  acknowledged  relation  of 
parent  and  child  between  the  decedent  and  beneficiary. 

174.  Burden  of  Proof. 

The  burden  of  proof  is  upon  a  person  claiming  the 
exemption  conferred  by  the  statute  to  establish  that 
she  is  entitled  to  it.  Matter  of  Davis,  98  App.  Div. 
546,  90  N.  Y.  S.  244.  See  also  Matter  of  Dennison, 
N.  Y.  Law  Journal  of  Aug.  17,  1903. 

175.  Stepparent  and  Stepchildren. 

A  stepparent  does  not  necessarily  stand  in  the  rela- 
tion of  a  parent  to  stepchildren,  within  the  meaning 


EXCEPTIONS   AND   LIMITATIONS.  177 

of  the  act.  Matter  of  Capron,  30  N.  Y.  St.  R.  948,  10 
N.  Y.  S.  23.  Whether  they  do  or  not  depends  upon 
the  circumstances  of  each  case. 

176.  Relation  of  the  Parties  —  Facts  Establishing. 

The  evidence  being  undisputed  that  the  decedent 
stood  in  the  relation  of  a  parent  to  the  residuary  lega- 
tee for  twenty  years  from  the  time  she  was  fifteen 
years  and  five  months  old,  when  he  married  her  mother, 
and  that  she  had  been  a  member  of  his  household  for 
several  years  before  that  time,  during  which  time  they 
addressed  each  other  as  father  and  daughter,  —  held, 
that  the  tax  on  the  legacy  to  her  should  be  reduced 
to  1  per  cent.  Matter  of  Lane,  39  Misc.  Rep.  522,  80 
N.  Y.  S.  381. 

177.  Living-  as  One  Family  Does  not. 

Living  as  one  family  does  not  establish  the  relation- 
ship between  an  uncle  and  his  nieces.  Matter  of  Moid- 
ton,  11  Misc.  Rep.  694,  33  N.  Y.  S.  578.  To  same  effect, 
Matter  of  Sweatland,  47  N.  Y.  St.  R.  287,  20  N.  Y.  S. 
310. 

178.  Lineal  Descendants. 

' '  Lineal  descendants  ' '  means  the  direct  descendants 
of  the  testator  or  intestate,  and  not  nephews  and  nieces. 
Matter  of  Miller,  45  Hun,  244. 

179.  When    the    Word    "Children"    is    Equivalent    to    "De- 

scendants." 

A  testatrix,  after  creating  a  trust  in  real  estate  to 
pay  the  income  equally  to  her  five  children  for  life, 
12 


178        THE  LAW  OF  TAXABLE  TRANSFERS. 

during  the  lives  of  two  of  them,  and  directed  that,  if 
a  child  died  during  the  trust,  his  or  her  share  of  the 
income  should  pass  to  him  or  her  surviving  "  lawful 
children,' '  and  one  of  the  sons  died  after  the  testatrix, 
leaving  a  daughter,  who  also  died  and  left  children,  — 
held,  that  the  grandchildren  of  the  deceased  son  were 
entitled  during  the  trust  to  one-fifth  of  the  income,  and 
that  the  word  "  children  "  should  be  read  as  meaning 
"  descendants."  Matter  of  Bender,  44  Misc.  Rep.  79> 
89  N.  Y.  S.  731. 

180.  "  Husband  "  of  a  Daughter  Includes  "  Widower." 

A  legacy  to  the  husband  of  a  daughter  is  exempt, 
although  the  daughter  died  before  the  testator.  Matter 
of  Woolsey,  19  Abb.  N.  C.  232;  Matter  of  McGarvey,  6 
Dem.  145. 

And  this  is  so  even  if  the  husband  remarried  prior  to 
the  transfer  to  him.  Matter  of  Ray,  13  Misc.  Rep.  480, 
35  N.  Y.  S.  481.  See  opinion  as  to  the  use  of  the  word 
"  widower  "in  the  statutes. 

181.  "Specifically  Exempted." 

The  term  "  taxable  persons  "  includes  both  those 
in  the  1-per  cent,  and  the  5-per  cent,  classes,  and  such 
persons  are  not  specifically  exempted  the  same  as  a 
bishop  or  a  religious  corporation  {Matter  of  Corbett, 
171  N.  Y.  516),  for  the  reason  that,  if  the  estate  had 
been  sufficiently  large  to  equal  or  exceed  the  limita- 
tions, the  legacy  or  share  passing  to  the  1-per  cent, 
class  and  the  5-per  cent,  class,  respectively,  are  each 
liable  to  taxation,  while  a  legacy  to  a  bishop  or  a  reli- 


EXCEPTIONS   AND   LIMITATIONS.  179 

gious  corporation  is  not  taxable,  no  matter  how  large 
the  estate  may  be.  Matter  of  Garland,  88  App.  Div. 
380,  84  N.  Y.  S.  630;  Matter  of  McMurray,  96  App.  Div. 
129,  89  N.  Y.  S.  71.  And  where  a  legacy  is  given  to  a 
legatee,  who  is  specifically  exempted  by  the  statute, 
the  amount  thereof  is  first  to  be  deducted  from  the 
net  estate,  and  the  other  transfers  are  then  only  subject 
to  tax  in  the  event  of  the  remaining  estate  reaching  the 
taxable  limitations.    Matter  of  Corbett  {supra). 

The  clause  in  the  Collateral  Inheritance  Tax  Law  of 
1887  (chap.  713,  §  1),  exempting  from  taxation  there- 
under bequests  to  '  *  the  societies,  corporations  and  in- 
stitutions now  exempted  by  law  from  taxation," 
was  not  intended  to  apply  to  bequests  to  municipal 
corporations.     Matter  of  Hamilton,  148  N.  Y.  310. 

Prior  to  June  7,  1890,  a  corporation  claiming  ex- 
emption from  tax  upon  legacies  or  bequests  to  it  must 
show  such  exemption  either  by  its  own  charter  or  the 
provisions  of  some  general  law. 

Chapter  191  of  the  Laws  of  1889,  relating  to  the 
amount  of  property  to  be  held  by  corporations  organ- 
ized for  other  than  business  purposes,  as  amended  by 
chapter  553,  Laws  1890,  expressly  exempted  from  the 
Act  of  1885  taxing  gifts,  legacies,  and  collateral  inherit- 
ances in  certain  cases,  and  the  acts  amendatory  thereof, 
certain  corporations  therein  named,  the  act  stating  that 
this  provision  shall  not  apply  to  any  moneyed  or  stock 
corporation  deriving  an  income  or  profit  from  the 
capital  or  otherwise,  or  to  any  corporation  which  has 
the  right  to  make  dividends  or  to  distribute  profits  or 
assets  among  its  members. 


180  THE    LAW    OF    TAXABLE    TRANSFERS. 

The  Act  of  1892,  section  1,  imposed  a  tax  upon  trans- 
fers to  persons  or  corporations  "  not  exempt  by  law 
from  taxation  on  real  or  personal  property,"  and  this 
section  therefore  exempted  certain  corporations  which 
were  organized  for  other  than  the  usual  business  pur- 
poses, and  which  the  statutes,  general  or  special,  ex- 
empted from  taxation. 

When  the  Transfer  Tax  Law  became  Article  X  of 
the  general  law  (June  15,  1896),  chapter  553  of  the 
Laws  of  1890  (supra)  was  repealed  by  chapter  908, 
Laws  1896,  and  thereafter  the  provisions  of  section 
220  were  held  to  apply  to  the  societies,  corporations, 
and  institutions  mentioned  in  section  4  of  the  Tax 
Law,  including  a  bequest  to  a  municipal  corporation. 
Matter  of  Thrall,  157  N.  Y.  46. 

These  exemptions  continued  in  force  until  the  amend- 
ment by  chapter  380,  Laws  1900,  in  effect  April  11th 
of  that  year,  which  provided  that  the  exemptions 
mentioned  in  section  4  of  the  Tax  Law  should  not 
apply  to  the  Transfer  Tax  Law.     (See  §  243,  post.) 

It  was  held  in  the  Matter  of  Huntington,  168  N.  Y. 
399,  that  this  amendment  included  all  the  exemptions 
granted  to  corporations  by  general  or  special  acts,  ex- 
cept those  mentioned  in  section  221.  Reversing  Matte) 
of  Howell,  34  Misc.  Rep.  40,  69  N.  Y.  S.  505. 

In  the  Matter  of  Watson,  171  N.  Y.  256,  it  was  held 
that  since  this  amendment  bequests  to  Y.  M.  C.  A.  and 
missionary  societies  were  taxable.  In  the  Matter  of 
Frail,  78  App.  Div.  301,  79  N.  Y.  S.  971,  it  was  held 
"that  the  "  Protestant  Episcopal  Church  Missionary 
Society  for   Seamen  in  the  City  and  Port   of  New 


EXCEPTIONS   AND    LIMITATIONS.  181 

York  "  was  exempt,  but  this  society  was  incorporated 
under  special  act  (chap.  147,  L.  1844)  as  a  religious 
corporation. 

By  chapter  458  of  the  Laws  of  1901,  in  effect  April 
22d  of  that  year  (§  221),  ''Corporations  organ- 
ized exclusively  for  bible  or  tract  purposes  "  were 
also  specifically  exempted,  and  by  this  same  amend- 
ment there  was  also  specifically  exempted  personal 
property  other  than  money  or  securities  bequeathed 
to  corporations  or  associations  organized  exclusively 
for  the  moral  or  mental  improvement  of  men  or  wo- 
men, and  also  certain  nonbusiness  corporations  men- 
tioned in  said  section  221. 

182.  Corporations  Specifically  Exempted  by  the  Act  of  1905. 

By  chapter  368,  Laws  1905,  educational,  charitable, 
missionary,  benevolent,  hospital,  or  infirmary  corpo- 
rations are  included  in  the  list  of  corporations  specifi- 
cally exempted. 

Under  the  exemption  applying  to  religious  corpora- 
tions, the  court  held,  in  the  Matter  of  Balleis,  144  N.  Y. 
132,  that  the  exemption  applies  only  to  domestic  cor- 
porations, and  it  is  believed  that  the  exemptions  by 
the  Act  of  1905,  granted  to  the  corporations  above 
named,  will  not  apply  to  corporations  foreign  to  the 
State  of  New  York,  even  though  the  foreign  corpora- 
tion within  the  class  above  named  is  exempt  by  law 
from  taxation  in  its  own  State.  Matter  of  Prime,  136 
N.  Y.  347. 

Since  the  enactment  of  section  243,  in  effect  April 
11,  1900,  a  large  number  of  decisions  affecting  the 


182  THE   LAW    OF    TAXABLE    TRANSFERS. 

claim  of  various  institutions  and  charitable  corpora- 
tions for  exemption,  have  become  of  no  importance  for 
reference,  and  therefore  they  are  not  included  in  the 
following. 

183.  Decisions  Affecting  Exemptions  Generally. 

One  claiming  exemption  from  taxation  must  be  able 
to  point  specifically  to  the  statute  creating  that  exemp- 
tion, as  an  exemption  will  not  be  inferred  or  assumed. 
Matter  of  Moore,  90  Hun,  162,  35  N.  Y.  S.  782.  And 
the  same  strict  rule  is  applied  to  religious  and  chari- 
table corporations.  Church  of  St.  Monica  v.  Mayor, 
etc.,  119  N.  Y.  91. 

1.  The  exemption  to  a  bishop  applies  to  a  resident 
or  nonresident  bishop.  Also  a  bequest  to  a  bishop 
(naming  him),  "  or  to  his  living  successor,"  is  exempt. 
Matter  of  Palmer,  33  App.  Div.  307,  53  N.  Y.  S.  847. 

2.  The  exemption  to  a  bishop  includes  an  "  arch- 
bishop," or  "  cardinal  bishop."  Matter  of  Kelly,  29 
Misc.  Rep.  169,  60  N.  Y.  S.  1005. 

3.  But  the  exemption  to  a  religious  corporation  ap- 
plies only  to  a  domestic  religious  corporation.  Matter 
of  Ballets,  144  N.  Y.  132,  following  Matter  of  Prime, 
136  N.  Y.  347  (decided  under  the  Act  of  1885,  as 
amended),  where  Judge  Andrews  says:  "A  statute 
granting  powers  and  privileges  to  a  corporation  must, 
in  the  absence  of  plain  indications  to  the  contrary,  be 
held  to  apply  only  to  corporations  created  by  the  State 
and  over  which  it  has  power  of  visitation  and  control. ' ' 

4.  The  Appellate  Division,  in  the  Matter  of  Graves, 
66  App.  Div.  267,  72  N.  Y.  S.  815,  held  that  a  bequest 


EXCEPTIONS  AXD  LIMITATIONS.  183 

to  trustees  in  trust  to  erect  and  maintain  ' '  a  home  for 
those  who  by  misfortune  have  become  incapable  of  pro- 
viding for  themselves,  and  those  *  *  who  have 
slender  means  of  support,"  was  subject  to  a  transfer 
tax,  as  subdivision  7  of  section  4  of  the  Tax  Law  pro- 
vided that  property  of  "  corporations  or  associations  ' 
organized  exclusively  for  charitable  purposes  shall  be 
exempt  from  taxation,  and  section  220  of  the  Tax  Law, 
imposing  a  transfer  tax  upon  property  passing  "  to 
persons  or  corporations  not  exempt  by  law  from  taxa- 
tion," does  not  include  a  gift  for  charitable  purposes 
to  trustees.  The  Court  of  Appeals  reversed  this  de- 
cision, holding  that  where  a  residuary  estate  is  in  the 
hands  of  trustees,  to  be  held  for  two  lives  in  being  for 
the  purpose  of  founding,  erecting,  and  maintaining  a 
home  for  the  aged,  it  is  not  subject  to  a  transfer  tax, 
being  exempted  therefrom  by  chapter  701  of  the  Laws 
of  1893,  re-establishing  the  law  of  charitable  uses,  and 
is  to  be  treated  as  if  a  corporation  or  association  had 
been  formed.     Matter  of  Graves,  171  N.  Y.  40. 

5.  A  legacy  to  a  college  outside  of  this  State  is  not 
exempt,  although  the  charter  granted  by  its  own  State 
exempts  it  from  taxation.  Matter  of  McCoskey,  22 
Abb.  N.  C.  20. 

The  words  "  now  exempted  by  law  "  refer  to  ex- 
emptions under  our  laws  only.  Catlin  v.  Trustees  of 
Trinity  College,  113  N.  Y.  133. 

6.  Vassar  Bros'.  Home  for  Aged  Men,  John  Guy 
Vassar  Orphan  Asylum,  Vassar  Bros'.  Hospital,  and 
Vassar  College  were  exempt  under  Act  of  1887.  Matter 
of  Vassar,  127  N.  Y.  1. 


184  THE    LAW    OF    TAXABLE    TRANSFERS. 

7.  Foreign  religious  and  charitable  corporations 
were  not  exempted  by  chapter  553  of  the  Laws  of  1890. 
Matter  of  Prime,  136  N.  Y.  347;  Matter  of  Merriam, 
141  N.  Y.  479. 

8.  Section  243  of  the  Tax  Law,  added  by  chapter  382, 
Laws  of  1900,  which  provides  that  the  exemptions  men- 
tioned in  section  4  of  the  Tax  Law  are  not  to  be  con- 
strued as  applying  to  the  provisions  of  article  10,  im- 
posing a  transfer  tax,  does  not  apply  to  a  bequest  to  a 
charitable  or  benevolent  corporation  exempt  from  tax- 
ation under  section  4  of  the  general  Tax  Law  made  by 
the  will  of  a  testator  who  died  prior  to  the  passage  of 
the  Act  of  1900.  Matter  of  VanderbUt,  68  App.  Div. 
27,  74  N.  Y.  S.  450;  modified  on  other  points  in  172 
N.  Y.  69. 


CHAPTER  IX. 


Taxable  Transfers  —  Accrual  and  Payment  of  Tax 
—  Discount  and  Interest. 


184.  Accrual   and  payment  of  tax. 

185.  The  general  subject. 

186.  When  the  tax  accrues. 

187.  Accrual,  on  future  and  contin- 

gent estates. 

Id. ;  when  appointment  is  to 
be  exercised  over  fund. 

Id. ;  on  certain  remainder  in- 
terests. 

Id.;  on  remainder  when  life 
tenant  can  use  principal. 

Id. ;  upon  renounced  legacy. 

Payment;  to  whom  made. 

Id. ;  when  estate  has  been  dis- 
tributed. 

194.  Voluntary  payment. 

195.  When    payment    not    deemed 

voluntary. 

196.  Payment   in   case   of  a  legacy 

in    trust    for    life    with    re- 
mainder over. 

197.  Payment  of  tax  on  remainders, 

Act  of  1887. 

198.  Payment  of  tax  upon  a  trust 

estate. 


188. 

189. 

190. 

191. 
192. 
193. 


199.  Payment  of  tax  at  decedent's 

domicile. 

200.  Provisions  of  section  222  not 

repealed  by  implication. 

201.  When    tax   not    payable    from 

the  estate  by  the  words  of  a 
will. 

202.  Discount  and  interest. 

203.  When  a  discount  is  allowed. 

204.  Interest. 

205.  Remission  of  interest. 

206.  Application  for. 

207.  To  whom  made. 

208.  Ignorance  of  the  law;  no  ex- 

cuse. 

209.  When  application  will  be  de- 

nied. 

210.  When  interest  commences. 

211.  Interest  under  the  Act  of  1887. 

212.  Accrued  right. 

213.  Other     decisions     relating    to 

discount  and   interest. 

214.  Corresponding  sections  of  for- 

mer   acts    relating    to    dis- 
count and  interest. 


184.  Accrual  and  Payment  of  Tax. 

[§  222,  Tax  Law.]     All  taxes  imposed  by  this  article  shall 
be  due  and  payable1  at  the  time  of  the  transfer,2  except  as 


1.  Sec.  4,  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year. — 
Provided  that  all  taxes  unless  otherwise  provided,  was  due  and  pay- 
able at  the  death  of  the  decedent. 

2.  Sec.  3,  Chap.  399,  Laws  1892  — in  effect  May  1  of  that  year- 
Provided  that  all   taxes  shall   be  due  and   payable   at  the   time  of  the 

11 85  J 


186  THE    LAW    OF    TAXABLE    TRANSFERS. 

herein  otherwise  provided.  Taxes  upon  the  transfer  of  any 
estate,  property  or  interest  therein  limited,  conditioned,  de- 
pendent, or  determinable  upon  the  happening  of  any  con- 
tingency or  future  event  by  reason  of  which  the  fair  market 
value  thereof  cannot  be  ascertained  at  the  time  of  the  trans- 
fer as  herein  provided,  shall  accrue  and  become  due  and  pay- 
able when  the  persons  or  corporations  beneficially  entitled 
thereto  shall  come  into  actual  possession  or  enjoyment 
thereof.3  Such  tax  shall  be  paid  to  the  state  comptroller  in 
a  county  in  which  the  office  of  appraiser  is  salaried,  and  in 
other  counties,  to  the  county  treasurer,  and  said  state  comp- 
troller or  county  treasurer  shall  give,  and  every  executor, 
administrator  or  trustee  shall  take,  duplicate  receipts  from 
him  of  such  payment  as  provided  in  section  two  hundred  and 
thirty-six.4 

185.  The  General  Subject. 

Section  4  of  the  Act  of  1885  fixed  the  time  when  the 
tax  became  due  and  payable  as  the  date  of  the  dece- 
dent's death,  unless  otherwise  provided. 

Section  1  of  the  Act  of  1892  declared  that  the  tax  was 
imposed  upon  the  transfer  of  any  property,  and  sec- 
tion 3  of  said  act  states  that  all  taxes  imposed  by  this 
act  shall  be  due  and  payable  at  the  time  of  the  transfer, 

transfer,  unless  the  fair  market  value  of  decedent's  estate  could  not  be 
ascertained  at  that  time,  in  which  event  the  tax  became  due  and  pay- 
able  when  the  person  or  corporation  come  into  actual  possession  or  en- 
joyment thereof. 

3.  Sec.  3,  Chap.  399,  Laws  1892  — in  effect  May  1  of  that  year. — 
Contained  provision  similar  to  the  foregoing,  relative  to  the  accrual 
of  the  tax.  See  Matter  of  Babcock,  37  Misc.  Rep.  455;  affd.,  81  App. 
Div.  645,  as  to  this  provision  not  conflicting  with  chapter  76,  Laws  of 
1899,  in  reference  to  the  immediate  taxation  of  all  estates  in  re- 
mainder. 

4.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  Amends 
section  222  by  placing  the  provision  of  former  section  222,  relating 
to  the  lien  of  tax,  under  section  224,  and  the  provision  relating  to  the 
receipts  to  be  given  upon  the  payment  of  tax  under  section  236.  and 
adds  a  provision,  new  only  in  phraseology,  respecting  the  payment  of 
tax  and  to  whom  same  shall  be  made. 


ACCRUAL   AND   PAYMENT   OF   TAX.  187 

with  a  proviso  relative  to  the  accrual  of  the  tax  in 
cases  where  the  value  of  the  estate  cannot  be  deter- 
mined until  the  happening  of  some  contingency  or 
future  event  upon  which  such  estate  was  dependent. 
This  same  provision  was  continued  in  section  222  of 
the  Act  of  1896,  and  was  re-enacted  in  section  222  of 
the  Act  of  1905. 

186.  When  the  Tax  Accrues. 

The  time  of  the  transfer  by  a  will,  or  the  intestate 
laws,  is  at  the  death  of  the  decedent.  Matter  of  Sloane, 
154  N.  Y.  109.  The  tax  accrues  at  that  time  {Matter 
of  Davis,  149  N.  Y.  539 ;  Matter  of  Westurn,  152  N.  Y. 
93-102;  Matter  of  Seaman,  147  N.  Y.  69-74;  Matter  of 
Green,  153  N.  Y.  223-228),  and  the  legatee  is  only 
entitled  to  his  legacy,  less  the  tax.  Matter  of  Gihon, 
169  N.  Y.  443. 

187.  Accrual,  on  Future  and  Contingent  Estates. 

Since  chapter  76,  Laws  of  1899,  amending  section 
230  of  the  Act  of  1896,  in  reference  to  the  immediate 
taxation  of  all  contingent  estates  in  remainder  and 
the  payment  of  the  tax  forthwith  out  of  the  principal, 
the  tax  upon  certain  future  and  contingent  estates  ac- 
crues at  the  decedent's  death.  Matter  of  Vanderbilt, 
172  N.  Y.  69;  Matter  of  Brez,  172  N.  Y.  609. 

1 88.  Id. ;  When  Appointment  is  to  be  Exercised  Over  Fund. 

By  chapter  284,  Laws  of  1897,  amending  section  220, 
relative  to  the  exercise  of  a  power  of  appointment,  the 
tax  in  such  cases  does  not  accrue  until  the  death  of  the 
donee  of  the  power.    Matter  of  Tucker,  27  Misc.  Rep. 


188  THE   LAW    OF    TAXABLE   TRANSFERS. 

616;  Matter  of  Stewart,  131  N.  Y.  274;  Matter  of  De- 
lano, 176  N.  Y.  486;  Matter  of  Howe,  86  App.  Div.  286, 
83  N.  Y.  S.  825;  affd.,  176  N.  Y.  570. 

189.  Id.;  on  Certain  Remainder  Interests. 

The  tax  does  not  accrue  on  remainder  interests 
wkere  the  life  tenant  is  given  the  right  to  use  any  or 
all  the  principal  for  his  support  and  maintenance,  un- 
til the  death  of  the  life  tenant.  Matter  of  Bab  cock,  37 
Misc.  Rep.  445,  75  N.  Y.  S.  926;  affd.,  81  App.  Div.  645, 
81  N.  Y.  S.  1117. 

190.  Id.;  on  Remainder  When  Life  Tenant  Can  Use  Principal. 
Where  the  life  tenant  is  given  the  right  to  use  a  part 

or  all  of  the  principal,  the  value  of  the  remainder  is 
the  present  value  of  the  sum  remaining  as  of  the  tes- 
tator's death,  but  payable  at  the  time  of  the  life  ten- 
ant's death,  the  tax  accruing,  however,  at  the  testator's 
death.  Matter  of  Meyer,  83  App.  Div.  381,  82  N.  Y.  S. 
329. 

191.  Id.;  Upon  Renounced  Legacy. 

The  decision  of  the  court  in  the  Matter  of  Wolfe,  89 
App.  Div.  349,  85  N.  Y.  S.  949;  affd.,  179  N.  Y.  599,  to 
the  effect  that  there  is  no  taxable  transfer  of  a  legacy 
where  the  legatee  renounces  his  legacy,  does  not  affect 
the  time  when  the  tax  accrues,  but  may  affect  the  rate 
of  tax,  as  it  did  in  that  case. 

192.  Payment— To  Whom  Made. 

The  counties  of  Albany,  Dutchess,  Erie,  Kings,  Mon- 
roe, New  York,  Oneida,  Onondaga,  Orange,  Queens, 
Rensselaer,  Richmond,  Suffolk,  and  Westchester  are 


ACCRUAL   AND   PAYMENT   OF    TAX.  189 

the  ones  referred  to  in  this  section,  in  which  the  office 
of  transfer  tax  appraiser  is  salaried,  and  the  tax  is 
therefore  to  be  paid  direct  to  the  State  Comptroller,  at 
Albany,  N.  Y. 

In  the  other  counties  the  tax  is  payable  to  the  treas- 
urer of  the  county  in  which  the  proceedings  are  in- 
stituted. 

193.  Id.;  When  Estate  has  Been  Distributed. 

It  was  held  under  the  1885  statute  that  the  fact  that 
an  estate  had  been  distributed  is  no  excuse  for  non- 
payment of  the  tax.  Matter  of  Hackett,  14  Misc.  Rep. 
282,  35  N.  Y.  S.  1051.  And  later,  in  case  of  a  nonresi- 
dent decedent,  that  the  jurisdiction  of  the  surrogate  of 
the  county  in  this  State  where  the  personal  property 
was  situated  at  the  time  of  the  death  of  the  owner  is  not 
lost,-  where  the  executor  has  taken  the  property  from 
this  State  and  distributed  it,  but  the  proper  surrogate 
can  appoint  an  appraiser  and  fix  the  tax.  Matter  of 
Hubbard,  21  Misc.  Rep.  566,  48  N.  Y.  S.  869.  See  also 
Matter  of  Fitch,  26  Misc.  Rep.  353,  57  N.  Y.  S.  212; 
affd.  on  other  points,  160  N.  Y.  87. 

194.  Voluntary  Payment. 

Payment  of  the  transfer  tax  by  a  nephew  receiving  a 
life  estate  by  the  will,  withholding  the  fact  that  he  had 
an  unrecorded  deed  of  the  premises  made  in  his  favor 
by  the  testator  in  his  lifetime,  was  held  to  be  a  volun- 
tary payment  not  to  be  recovered  back  upon  produc- 
tion of  the  deed  eight  years  after  the  entry  of  the  order 
assessing  the  tax  upon  the  transfer  to  the  nephew. 
Matter  of  Mather,  41  Misc.  Rep.  414,  84  N.  Y.  S.  1105, 
90  App.  Div.  382,  85  N.  Y.  S.  657. 


190  THE    LAW    OF    TAXABLE    TRANSFERS. 

195.  When  Payment  not  Deemed  Voluntary. 

Where,  subsequent  to  the  payment  of  a  tax  by  the 
executor,  the  statute  under  which  the  tax  was  levied 
was  thereafter  declared  unconstitutional, —  held,  that 
the  act  of  the  executor  was  done  not  under  a  mistake  of 
law  but  rather  as  to  the  existence  of  the  statute,  and 
the  remaindermen  could  recover  back  the  amount  with 
interest  as  the  payment  was  not  a  voluntary  one. 
Matter  of  0' Berry,  91  App.  Div.  3,  86  N.  Y.  S.  269; 
affd.,  179  N.  Y.  285;  Mtna  Ins.  Co.  v.  Mayor,  etc., 
of  New  York,  153  N.  Y.  331. 

A  law  supported  only  by  an  unconstitutional  statute 
is  simply  void.  Such  a  statute  confers  no  right,  im- 
poses no  duties,  confers  no  power,  and  in  legal  coDtein- 
plation  is  as  inoperative  for  any  purpose  as  if  it  had 
never  been  passed.  Norton  v.  Selby  County,  118  U.  S. 
425;  Matter  of  Brenner,  170  N.  Y.  185-194;  Matter  of 
0' 'Berry,  179  N.  Y.  285. 

196.  Payment  in  Case  of  a  Legacy  in  Trust  for  Life  With  Re- 

mainder Over. 

The  rule  that  inheritance  taxes  on  a  money  legacy 
may  be  deducted  from  the  principal  by  the  executors 
of  the  will  does  not  apply  to  a  legacy  given  them  in 
trust  for  the  benefit  of  one  person  for  life  with  remain- 
der to  another,  as  neither  of  these  later  persons  suc- 
ceeds to  or  has  anything  more  than  a  legal  right  in  the 
fund,  and  from  such  right  no  such  deduction  can  bo 
made.  In  such  case  each  beneficiary  must  pay  his  own 
tax  and  on  the  basis  of  his  interest  in  the  fund,  and 
failing  payment,  nothing  can  be  sold  but  the  right  in 
the  fund  of  the  party  making  default.    The  tax  of  the 


ACCRUAL   AND   PAYMENT   OF    TAX.  191 

life  tenant  is  payable  from  income  while  the  tax  of  the 
remaindermen  is  presently  payable  by  him.  Matter  of 
Hoyt,  37  Misc.  Kep.  720,  76  N.  Y.  S.  504.  But  see  Mat- 
ter of  Hoyt,  44  Misc.  Rep.  76,  89  N.  Y.  S.  744;  also 
Matter  of  Tracy,  179  N.  Y.  501. 

197.  Payment  of  Tax  on  Remainders  —  Act  of  1887. 

The  life  tenant  is  not  liable  to  pay  the  tax  upon  re- 
mainders, but  the  same  should  be  paid  by  the  bene- 
ficiaries. Matter  of  McMahon,  28  Misc.  Rep.  697,  60 
N.  Y.  S.  64.    Decision  Act  1887. 

198.  Payment  of  Tax  Upon  a  Trust  Estate. 

The  transfer  tax  upon  a  trust  estate  is  to  be  paid  out 
of  the  capital  of  the  trust  fund,  including  the  part 
assessed  against  the  interest  of  the  life  beneficiary. 
Matter  of  Hoyt,  44  Misc.  Rep.  76,  89  N.  Y.  S.  744. 

199.  Payment  of  Tax  at  Decedent's  Domicile. 

Payment  of  tax  at  the  domicile  of  a  nonresident  de- 
cedent is  no  objection  to  imposing  the  tax  here.  Mat- 
ter of  Daly,  100  App.  Div.  373,  91  N.  Y.  S.  858;  affd., 
182  N.  Y.  Mem.  ;  Matter  of  Burr,  16  Misc.  Rep.  89, 
38  X.  Y.  S.  811. 

200.  Provision  of  Section  222  not  Repealed  by  Implication. 
The  exception,  in  reference  to  the  accrual  of  the  tax, 

where  persons  beneficially  entitled  thereto  shall  come 
into  the  actual  possession  thereof,  where,  by  reason 
of  some  limitation  or  condition,  the  fair  market  value 
cannot  be  ascertained  at  the  time  of  the  transfer,  was 
not  impliedly  repealed  by  chapter  76,  Laws  of  1899, 
amending  section  230,  and  providing  for  the  immediate 


192         THE  LAW  OF  TAXABLE  TRANSFERS. 

taxation  of  all  remainder  estates.  Matter  of  Babcock, 
37  Misc.  Rep.  445-447,  75  N.  Y.  S.  926;  affd.,  81  App. 
Div.  645,  81  N.  Y.  S.  1117. 

201.  When  Tax  not  Payable   from  the  Estate  by  the  Words 

of  a  Will. 

A  provision  in  decedent's  will,  authorizing  executors 
to  pay  legacies  within  one  year  after  his  death,  ' '  with- 
out any  rebate  or  reduction  whatever,"  does  not  en- 
title the  legatee  to  receive  the  legacy  entire  and  without 
the  transfer  tax  thereon  being  deducted,  and  particu- 
larly so  where  the  will  was  made  before  the  enactment 
of  the  Transfer  Tax  Law.  Jackson  v.  Tailer,  41  Misc. 
Rep.  36,  83  N.  Y.  S.  567. 

202.  Discount    and  Interest. 

[§  223,  Tax  Law.]  If  such  tax  is  paid  within  six  months 
from  the  accrual  thereof,  a  discount  of  five  per  centum  shall 
be  allowed  and  deducted  therefrom.1  If  such  tax  is  not  paid 
within  eighteen  months  from  the  accrual  thereof,  interest 
shall  be  charged  and  collected  thereon  at  the  rate  of  ten  per 
centum  per  annum  from  the  time  the  tax  accrued;2  unless 
by  reason  of  claims  made  upon  the  estate,  necessary  litigation 
or  other  unavoidable  cause  of  delay,  such  tax  cannot  be  de- 

1.  See.  4,  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year- 
Provided  that  if  the  tax  was  paid  within  one  year,  interest  at  6  per 
cent,  per  annum  should  be  charged,  but  if  not  so  paid  then  interest 
at  10  per  cent,  shall  be  charged,  except  as  limited  by  section  5  of  said 
act;  and  it  was  further  provided  that  if  the  tax  was  paid  within  six 
months  from  the  accrual  thereof  no  interest  should  be  charged,  but  a 
discount  of  5  per  cent,  could  be  deducted  from  the  amount  of  the  tax. 
This  provision  as  to  the  5  per  cent,  discount  has  ever  since  been  re- 
tained in  the  law. 

2.  Chap.  713,  Laws  1887  —  in  effect  June  25  of  that  year. —  Amended 
section  4  of  the  Act  of  1885  (supra),  by  providing  that  if  the  tax  was 
paid  within  eighteen  months  no  interest  shall  be  charged  and  collected 
thereon,  but  if  not  paid  within  that  time,  interest  at  the  rate  of  10 
per  cent,  shall  be  charged  from  time  the  tax  accrued,  and  this  provision 
has  been  retained  in  the  law. 


DISCOUNT    AND    INTEREST.  193 

terminer!  and  paid  as  herein  provided,3  in  which  case  interest 
at  the  rate  of  six  per  centum  per  annum  shall  be  charged 
upon  such  tax  from  the  accrual  thereof  until  the  cause  of 
such  delay  is  removed,  after  which  ten  per  centum  shall  be 
charged.4 

203.  When  a  Discount  is  Allowed. 

The  State  has  always  encouraged  the  early  payment 
of  the  transfer  tax  by  allowing  a  discount  of  5  per  cent, 
upon  the  amount  of  the  tax  where  payment  is  made 
within  six  months  from  the  accrual  thereof.* 

204.  Interest. 

The  interest  clause  was  changed  by  several  amend- 
ments prior  to  1892  as  to  the  time  within  which  the  tax 
must  be  paid  to  avoid  the  payment  of  interest,  but  since 
that  time  it  has  remained  practically  unchanged.! 

3.  Chap.  713,  Laws  1887  — in  effect  June  25  of  that  year.— Also 
amended  section  5  of  the  Act  of  1885,  by  providing  that  the  10  per  cent, 
interest  shall  not  be  charged  where  by  reason  of  claims  made  upon  the 
estate,  necessary  litigation  or  other  unavoidable  cause  of  delay,  the 
estate  cannot  be  settled  at  the  end  of  eighteen  months  from  decedent's 
death,  and  that  in  such  cases  only  6  per  cent,  per  annum  shall  be 
charged  upon  said  tax  "  from  the  expiration  of  said  eighteen  months," 
until  the  cause  for  delay  was  removed. 

4.  Chap.  399,  Laws  1892  — in  effect  May  1  of  that  year.—  Reenacted 
by  section  4  of  that  act,  the  former  provisions  of  sections  4  and  5  of 
the  Act  of  1885,  except  that  in  cases  of  remission  of  interest  from  10 
per  cent,  to  6  per  cent.,  the  6  per  cent,  was  to  be  charged  from  the 
accrual  of  the  tax,  instead  of  eighteen  months  from  the  decedent's 
death,  until  the  cause  for  delay  was  removed,  after  which  10  per  cent, 
was  to  be  charged,  and  the  provisions  of  the  Act  of  1892  in  respect 
to  discount  and  interest  have  remained  practically  the  same  since  that 
time. 

*  It  is  suggested  that  where  payment  of  transfer  tax  is  made  within 
six  months  from  the  accrual  of  the  tax,  the  discount  of  5  per  cent, 
should  be  deducted  by  the  person  making  the  payment,  from  the  amount 
of  tax  as  assessed,  and  not  include  such  discount  in  the  payment  made. 

tit  is  suggested  that  where  the  person  making  a  payment  of  tax 
forwards  the  same  by  mail  or  otherwise,  and  such  payment  is  desired 
to  be  made  within  the  time  to  secure  the  discount,  or  to  avoid  the 
payment  of  interest,  the  payment  must  be  received  by  the  proper  official 
on  or  before  the  last  day  within  which  such  payment  can  be  made  to 
entitle  such  person  to  the  discount,  or  to  avoid  the  payment  of  interest. 

13 


194  THE   LAW   OF   TAXABLE   TRANSFERS. 

205.  Remission  of  Interest. 

The  statute  only  provides  for  the  remission  of  the 
interest  from  10  to  6  per  cent,  in  certain  cases.  In- 
terest cannot  be  remitted  altogether.  (See  §  223, 
supra.) 

206.  Application  for. 

Application  to  remit  the  interest  can  only  be  made 
to  the  court  upon  motion,  and  is  not  to  be  the  subject 
of  an  appeal  from  the  decree  fixing  the  tax  as  the  de- 
cree should  not  concern  itself  with  the  amount  of  in- 
terest. Matter  of  De  Graaf,  24  Misc.  Rep.  147,  53  N. 
Y.  S.  591. 

207.  To  Whom  Made. 

The  appraiser  cannot  remit  the  interest.  Special 
application  showing  grounds  therefor  must  be  made 
to  the  surrogate.    Matter  of  De  Graaf  (supra). 

208.  Ignorance  of  the  Law  —  No  Excuse. 

Relief  from  the  payment  of  interest  will  not  be 
granted  where  the  only  reasons  given  were  that  the 
executors  were  ignorant  of  the  law,  or  that  such  pay- 
ment will  be  a  hardship  to  the  legatee.  Matter  of 
Piatt,  8  Misc.  Rep.  144,  29  N.  Y.  S.  396. 

209.  When  Application  Will  be  Denied. 

Application  for  the  remission  of  interest  will  be  de- 
nied unless  it  is  shown  that  the  reasons  required  by 
the  statute  existed  and  caused  the  delay.  Matter  of 
Wormser,  51  A  pp.  Div.  441,  64  N.  Y.  S.  897. 


DISCOUNT   AND    INTEREST.  195 

210.  When  Interest  Commences. 

When  the  liability  to  pay  interest  has  been  incurred 
it  is  chargeable  from  the  time  the  tax  accrued.  Mat- 
ter of  Davis,  149  N.  Y.  539,  540. 

211.  Interest  Under  the  Act  of  1887. 

Under  the  Act  of  1887,  where  an  estate  could  not  be 
settled  within  the  eighteen-months  limitation,  owing  to 
the  statutory  reasons,  interest  is  only  chargeable  at  6 
per  cent,  from  the  expiration  of  said  eighteen  months 
until  the  cause  for  delay  was  removed,  after  which  10 
per  cent,  was  chargeable.  Matter  of  Fayerweather, 
143  N.  Y.  114. 

212.  Accrued  Right. 

Where  the  liability  to  pay  interest  had  been  incurred 
under  the  Act  of  1887,  but  proceedings  were  not  com- 
menced until  after  the  passage  of  the  Act  of  1892,  the 
saving  clause  of  that  act  (§  24),  reserving  from 
the  repealing  clause  "  any  right  accruing,  accrued,  or 
acquired  prior  to  May  1,  1892,"  applies  to  the  liability 
to  pay  the  interest,  and  6  per  cent,  could  only  be 
charged  from  and  after  the  expiration  of  the  eighteen 
months.    Matter  of  Fayerweather,  143  N.  Y.  114. 

213.  Other  Decisions  Relating  to  Discount  and  Interest. 
Matter  of  Moore,  90  Hun,  162,  35  N.  Y.  S.  782;  Mat- 
ter of  Milne,  76  Hun,  328,  27  N.  Y.  S.  727;  People  v. 
Prout,  117  N.  Y.  650,  affg.  53  Hun,  541,  6  N.  Y.  S. 
457. 


196  THE    LAW    OF    TAXABLE    TRANSFERS. 

214.  Corresponding  Sections  of  Former  Acts  Relating  to  Dis- 
count and  Interest. 

In  the  original  Act  of  1885,  section  4  provided  that 
if  the  tax  was  paid  within  one  year  from  the  decedent's 
death,  interest  was  charged  at  the  rate  of  6  per  cent., 
unless  the  tax  was  paid  within  six  months  from  the 
accrual  thereof,  in  which  event  no  interest  was  charged 
and  a  deduction  of  5  per  cent,  was  allowed.  If  the  tax 
was  not  paid  within  one  year  then  interest  at  the  rate 
of  10  per  cent,  per  annum  was  to  be  charged  and  com- 
puted from  the  accrual  of  the  tax  until  payment  was 
made,  and  the  executor,  administrator,  or  trustee  was 
required  to  give  a  bond  for  the  payment  of  the  tax  and 
interest.  Section  5  of  this  act  provided  that  the  pen- 
alty of  10  per  cent,  should  not  be  charged  where,  by 
reason  of  claims  made  upon  the  estate,  necessary  liti- 
gation or  other  unavoidable  cause  of  delay  the  estate 
could  not  be  settled  at  the  end  of  one  year  from  the 
decedent's  death,  but  in  such  cases  only  6  per  cent, 
per  annum  should  be  charged  upon  the  tax  from  the 
expiration  of  such  year  until  the  cause  of  such  delay 
was  removed. 

Chapter  713,  Laws  of  1887,  in  effect  June  25th  of 
that  year,  amended  section  4  above,  by  providing  that 
if  the  tax  was  paid  within  eighteen  months  from  the 
decedent's  death  no  interest  should  be  charged  and  the 
representatives  of  the  estate  were  required  to  give  a 
bond  only  after  the  expiration  of  the  eighteen  months 
if  the  tax  remained  unpaid.  This  act  also  amended 
section  5  by  charging  the  6  per  cent,  penalty  incurred 
by  necessary  and  unavoidable  delay,  from  the  expira- 
tion of  the  eighteen  months  after  decedent's  death  un- 


DISCOUNT   AND    INTEREST.  197 

til  the  cause  of  delay  was  removed.  Matter  of  Fayer- 
weather,  143  N.  Y.  114;  Matter  of  Heller,  N.  Y.  Law 
Journal  of  July  16,  1904. 

Chapter  399,  Laws  of  1892,  in  effect  May  1st  of  that 
year,  consolidated  sections  4  and  5  of  the  Act  of  1885, 
and  substantially  re-enacted  the  provisions  of  said  sec- 
tions in  section  4  of  that  act,  except  that  in  cases  where 
the  penalty  had  been  remitted  from  10  to  6  per  cent,  the 
interest  commenced  from  the  accrual  of  the  tax,  in- 
stead of  a  period  eighteen  months  thereafter,  and  con- 
tinued until  the  cause  of  such  delay  was  removed,  after 
which  10  per  cent,  was  charged.  This  amendment  also 
provided  that  where  a  bond  was  given  to  defer  pay- 
ment of  tax,  interest  should  be  at  the  rate  of  6  per  cent, 
from  the  accrual  of  the  tax  until  paid. 

The  provisions  of  the  Act  of  1892  were  re-enacted 
in  section  223  of  chapter  908,  Laws  of  1896,  in  effect 
June  15th  of  that  year,  and  has  remained  unchanged. 

By  chapter  368,  Laws  of  1905,  in  effect  June  1st,  the 
provision  in  reference  to  giving  a  bond  to  defer  the 
payment  of  taxes  was  omitted,  section  226  of  the  Act 
of  1896,  referring  to  deferred  payments,  having  been 
entirely  omitted  in  the  Act  of  1905,  and  the  word 
"  penalty  "  was  omitted  from  the  title  to  this  section. 


CHAPTER  X. 


Taxable  Transfers  —  Lien   of   Tax  and   Collection 
Thereof  —  Refund  of  Tax  Erroneously  Paid. 


219. 


220. 


215.  Lien  of  tax  and  collection  by 

executors,  administrators, 
and  trustees. 

216.  The  general  subject. 

217.  The   tax  is   a   lien   upon   the 

property,  until  paid. 

218.  The    two-year    limitation     to 

enforce  payment  does  not 
apply. 

Neither  the  two,  nor  the  six- 
year  limitations  apply  to 
this  statute. 

Limitations  prescribed  by  sec- 
tion 282  of  the  Tax  Law. 

221.  Collection  of  tax  by  executors, 

etc. 

222.  Executors,   administrators,   or 

trustees;  liability. 

223.  Executor  liable;   although  es- 

tate has  been  distributed. 

224.  Tax  on  transfer  of  real  estate ; 

not  to  be  assessed  against 
executor. 

225.  Sale  of  what  property  to  pay 

tax. 

226.  Surrogate  cannot  decide  exec- 

utor's liability  to  pay  tax, 
on  motion. 


227.  Administrator  cannot  be  sued 

individually      for      transfer 
tax  withheld. 

228.  When  executor's  liability  ends. 

229.  Subrogation;  for  the  benefit  of 

creditors. 
290.  Refund     of     tax     erroneously 
paid. 

231.  The  general  subject. 

232.  Provisions  of  this  section  are 

exclusive. 

233.  Power   of   surrogate   to   order 

refund;      limitation      under 
Act  of  1897. 

234.  Refund;      debt      subsequently 

discovered. 

235.  Refund   after   time  to  appeal 

has  expired. 

236.  The  two-year  limitation,  chap- 

ter 382,  Laws  1900. 

237.  When   interest  attaches  to   a 

refund. 

238.  Order  need  not  direct  Comp- 

troller to  refund. 

239.  Right  to  refund  is  not  a  vested 

right. 

240.  Taxing  debts,  etc. ;  erroneously 

allowed. 


215.  I*ien  of  Tax  and  Collection  by  Executors,  Administrators, 
and  Trustees. 

[§  224,  Tax  Law.]  Every  such  tax  shall  be  and  remain 
a  lien  upon  the  property  transferred  until  paid  and  the 
person  to  whom  the  property  is  so  transferred,  and  the  exec- 

[198] 


LIEN,    AND    COLLECTION    OF    TAX.  199 

utors,  administrators  and  trustees  of  every  estate  so  trans- 
ferred shall  be  personally  liable  for  such  tax  until  its  pay- 
ment,1 Every  executor,  administrator  or  trustee,  shall  have 
full  power  to  sell  so  much  of  the  property  of  the  decedent 
as  will  enable  him  to  pay  such  tax  in  the  same  manner  as  he 
might  be  entitled  by  law  to  do  for  the  payment  of  the  debts 
of  the  testator  or  intestate.2  Any  such  executor,  admin- 
i-irator  or  trustee  having  in  charge  or  in  trust  any  legacy  or 
property  for  distribution  subject  to  such  tax  shall  deduct 
the  tax  therefrom  and  shall  pay  over  the  same  to  the  state 
comptroller  or  county  treasurer,  as  herein  provided.  If  such 
legacy  or  property  be  not  in  money,  he  shall  collect  the  tax 
thereon  upon  the  appraised  value  thereof  from  the  person 
entitled  thereto.  He  shall  not  deliver  or  be  compelled  to  de- 
liver any  specific  legacy  or  property  subject  to  tax  under  this 
article  to  any  person  until  he  shall  have  collected  the  tax 
thereon.  If  any  such  legacy  shall  be  charge'd  upon  or  payable 
out  of  real  property,  the  heir  or  devisee  shall  deduct  such 
tax  therefrom  and  pay  it  to  the  executor,  administrator  or 
trustee,  and  the  tax  shall  remain  a  lien  or  charge  on  such 
real  property  until  paid ;  and  the  payment  thereof  shall  be 
enforced  by  the  executor,  administrator  or  trustee  in  the 
-nine  manner  that  payment  of  the  legacy  might  be  enforced, 
of  by  the  district  attorney  under  section  two  hundred  and 
thirty-five  of  this  chapter.  If  any  such  legacy  shall  be  given 
in  money  to  any  such  person  for  a  limited  period,  the  exec- 
utor, administrator  or  trustee  shall  retain  the  tax  upon  the 


1.  Chap.  399,  Laws  1892  — in  effect  May  1  of  that  year.— First  con- 
tained  provision  relating  to  the  lien  of  all  taxes  and  also  the  personal 
liability  of  the  executors,  etc.,  for  payment  of  the  tax,  although  under 
Bection  4,  Act  of  1885,  as  amended  by  chapter  713,  Laws  1887,  if  ex- 
ecutor, <tc,  (lid  not  pay  tax  within  eighteen  months  from  decedent's 
death,  he  was  required  to  give  a  bond  for  the  payment  of  said  tax  and 
interest,  and  a  legacy  charged  on  real  estate  remained  a  charge  thereon 
until  paid.     (Sec.  6,  Act  1885.) 

2.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year.— Section  7 
<>f  the  Act  of  1885  gave  the  executor,  etc.,  power  to  sell  so  much  of  the 
property  of  decedent  as  would  enable  them  to  pay  the  tax.  This  pro- 
vision was  re-enacted  by  the  Act  of  1892  (supra),  becoming  a  part  of 
section  5  of  that  act,  and  was  also  re-enacted  as  a  part  of  section  224 
of  the  Act  of  1896,  chapter  908. 


200  THE    LAW    OF    TAXABLE    TRANSFERS. 

whole  amount,  but  if  it  be  not  in  money,  he  shall  make  ap- 
plication to  the  court  having  jurisdiction  of  an  accounting 
by  him,  to  make  an  apportionment,  if  the  case  require  it,  of 
the  sum  to  be  paid  into  his  hands  by  such  legatees,  and  for 
such  further  order  relative  thereto  as  the  case  may  require.3 

216.  The  General  Subject. 

Section  2  of  the  Act  of  1885,  amended  by  chapter  713, 
Laws  of  1887,  made  the  tax  and  interest  a  lien  upon 
the  property  transferred  under  section  1  of  that  act, 
and  sections  4,  6,  and  8  of  said  act  contained  provisions 
relating  to  the  personal  liability  of  the  executors  and 
administrators.  The  above  provision  including  the 
personal  liability  of  the  executors,  administrators,  and 
trustees  first  appeared  in  its  present  form  in  section  2 
of  the  Act  of  1892.  It  was  included  as  one  of  the  pro- 
visions of  section  222  of  chapter  908,  Laws  of  1896, 
and  re-enacted  as  part  of  section  224  of  chapter  368  of 
the  Laws  of  1905.  The  other  provisions  in  section  224 
(supra),  are  a  revision  of  sections  6,  7,  and  8  of  the 
Act  of  1885  as  re-enacted  in  sections  222  and  224  of  the 
Act  of  1896,  excepting  the  provisions  in  reference  to 
the  payment  of  the  tax,  which  was  re-enacted  as  a  part 
of  section  222  of  the  Act  of  1905  (supra). 

217.  The  Tax  is  a  Lien  Upon  the  Property  Until  Paid. 

A  purchaser  of  real  estate,  in  1898,  will  not  be  com- 
pelled to  take  title  to  premises  sold  in  foreclosure  pro- 
ceedings, where  it  appears  that  in  1893,  when  the  owner 

3.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year. —  Section  6 
of  the  Act  of  1885  contained  provisions  similar  to  the  foregoing  as  to 
the  manner  in  which  the  executor,  etc.,  should  collect  the  tax,  which 
provisions  were  re-enacted  as  a  part  of  section  5  of  the  Act  of  1892  and 
section  224  of  the  Act  of  1896. 


LIEN,    AND    COLLECTION    OF    TAX.  201 

of  the  premises  died,  they  were  subject  to  the  mortgage 
foreclosed,  and  that  the  devisee  of  the  premises,  un- 
related to  decedent,  had  never  paid  the  transfer  tax 
upon  the  succession  to  him,  as  the  tax  remains  a  lien 
upon  the  property  transferred  until  paid.  Kitching  v. 
Shear,  26  Misc.  Rep.  436,  57  N.  Y.  S.  464. 

218.  The  Two- Year  Limitation  to  Enforce  Payment  Does  not 

Apply. 

Under  the  Act  of  1885  Surrogate  Ransom  held  that 
it  was  the  settled  law  that  this  tax  is  upon  the  passing 
of  property,  upon  the  privilege  of  receiving  it,  and 
not  upon  the  property  itself,  and  therefore  as  it  was  a 
tax  upon  the  devolution  of  property,  section  384  of  the 
Code  of  Civil  Procedure,  requiring  all  actions  to  re- 
cover a  statutory  penalty  or  forfeiture  to  be  brought 
within  two  years  after  the  cause  of  action  accrues,  did 
not  apply  to  proceedings  to  enforce  such  a  tax.  Mat- 
ter of  Vanderbilt,  10  N.  Y.  S.  239-241. 

219.  Neither  the  Two  Nor  Six- Year  Limitations  Apply  to  this 

Statute. 

Following  the  decision  of  Surrogate  Ransom  in  the 
Matter  of  Vanderbilt,  10  N.  Y.  S.  239,  Surrogate  Fitz- 
gerald held,  that  neither  the  two  or  the  six-year  stat- 
ute of  limitations  are  a  defense  to  a  proceeding  to 
collect  the  transfer  tax,  as  the  tax  is  paid  upon  the 
devolution  of  the  property  and  not  upon  the  property 
itself.  Matter  of  Crerar,  31  Misc.  Rep.  481,  65  N.  Y.  S. 
573 ;  revd.on  other  points  in  56  App.  Div.  479,  67  N.  Y. 
S.  795. 


202  THE    LAW    OF    TAXABLE    TRANSFERS. 

220.  Limitations  Prescribed  by  Section  282  of  the  Tax  Law. 

By  chapter  737  of  the  Laws  of  1899,  section  282  was 
added  to  the  General  Tax  Laws  of  1896,  and  this  sec- 
tion provides  as  follows : 

§  282.  Limitation  of  time. —  The  provisions  of  the  code  of 
civil  procedure,  relative  to  the  limitation  of  time  of  enforc- 
ing a  civil  remedy,  shall  not  apply  to  any  proceeding  or 
action  taken  to  levy,  appraise,  assess,  determine  or  enforce 
the  collection  of  any  tax  or  penalty  prescribed  by  articles 
nine  or  ten  of  said  chapter,  and  this  act  shall  be  construed 
as  having  been  in  effect  as  of  date  of  the  original  enactment 
of  the  corporation  and  inheritance  tax  law,  provided,  how- 
ever, that  as  to  real  estate  in  the  hands  of  bona  fide  pur- 
chasers, the  transfer  tax  shall  be  presumed  to  be  paid  and 
cease  to  be  a  lien  as  against  such  purchasers  after  the  expira- 
tion of  six  years  from  the  date  of  accrual.  This  act  shall  not 
affect  any  action  or  proceeding  now  pending. 

The  courts  have  never  been  called  upon  to  construe 
and  apply  this  exception  in  favor  of  real  estate  in  the 
hands  of  bona  fide  purchasers. 

Since  the  enactment  of  section  282,  aforesaid,  the 
court  held,  in  the  Matter  of  Moench,  39  Misc.  Rep.  480, 
80  N.  Y.  S.  222,  that,  assuming  the  transfer  tax  to  be 
"  a  liability  created  by  statute  "  and  barred  in  six 
years  under  Code  of  Civil  Procedure,  section  382,  sub- 
division 2,  and  that  the  tax  could  not  have  been  en- 
forced under  chapter  399,  Laws  of  1892,  until  eighteen 
months  after  the  death  of  the  testatrix  on  January  12, 
1893,  a  proceeding  to  collect  it  could  have  been  taken  at 
any  time  before  July  12, 1900,  and  that  before  that  date 
chapter  737,  Laws  of  1899,  had  taken  away  the  defense 
of  the  statute.    See  also  Matter  of  Lord,  N.  Y.  Law 


LIEN,    AND    COLLECTION    OF    TAX.  203 

Journal  of  June  3,  1905,  where  Surrogate  Thomas 
holds  that  the  statute  of  limitations  was  not  a  bar  to 
the  proceedings  to  assess  the  tax,  the  decedent  having 
died  in  January  of  1892. 

221.  Collection  of  Tax  by  Executors,  Etc. 

The  statute  makes  a  clear  distinction  between  the 
manner  of  collecting  the  tax  on  money  legacies,  and 
other  interests. 

In  respect  to  legacies  or  property  for  distribution  it 
provides  that  the  executor  or  administrator  "  shall 
deduct  the  tax  therefrom  ' '  and  pay  the  same  over,  etc. 

This  same  section  provides  further,  "  If  such  legacy 
or  property  be  not  in  money  he  shall  collect  the  tax 
thereon  upon  the  appraised  value  thereof  from  the 
persons  entitled  thereto." 

It  was  accordingly  held  in  the  Matter  of  Hoyt,  37 
Misc.  Rep.  720,  76  N.  Y.  S.  504,  that  where,  first,  a 
legacy  of  $20,000  was  given  to  executors  in  trust  to  pay 
the  income  to  S.  for  life,  with  reversion  to  the  New 
York  Botanical  Garden;  second,  a  legacy  of  $20,000 
to  the  executors,  in  trust,  to  pay  the  income  to  C.  for 
life,  one-twelfth  reversion  to  the  Botanical  Garden; 
and,  third,  a  legacy  to  the  garden  of  one-twelfth  of  the 
residuary ;  that  the  transfer  to  the  garden  was  a  right 
to  receive  $20,000  at  a  certain  time.  What  is  trans- 
ferred to  the  life  tenant  is  the  right  to  receive  the  in- 
come which  may  accrue  during  her  life,  and  that  the 
collection  of  the  tax  upon  these  interests  must  there- 
fore be  made  in  the  manner  prescribed  for  interests 
other  than  money  legacies,  and  this  is  to  collect  the 
tax  from  the  beneficiaries  themselves. 


204  THE    LAW    OF    TAXABLE    TRANSFERS. 

It  would  seem,  however,  that  the  tax  upon  both  the 
life  estate  and  remainder  interest  was  properly  pay- 
able out  of  the  funds  transferred  in  trust,  as  the  de- 
cedent died  September  19,  1899,  at  which  time  chapter 
76,  Laws  of  1899,  was  in  force.  See  Matter  of  Tracy, 
179  N.  Y.  501-510. 

For  the  manner  in  which  the  tax  is  to  be  collected  on 
any  specific  legacy  or  property  transferred,  or  where 
legacy  is  chargeable  on  real  property,  etc.,  see  section 
224. 

222.  Executors,  Administrators,  or  Trustees  —  Liability. 

The  executor,  administrator,  or  trustee  is  made  per- 
sonally liable  for  the  payment  of  the  tax,  and  under  the 
Act  of  1885,  in  the  Matter  of  Jones,  5  Dem.  30,  it  was 
held  that  credit  on  the  accounting  might  be  refused 
unless  the  executor  produced  the  voucher  showing  pay- 
ment of  tax. 

223.  Executor  Liable,  Although  Estate  Has  Been  Distributed. 
The  fact  that  the  whole  estate  has  been  paid  out 

prior  to  the  assessment  of  the  tax  is  no  legal  excuse 
for  the  nonpayment  of  the  tax.  Matter  of  Hackett,  14 
Misc.  Rep.  282,  35  N.  Y.  S.  1051. 

There  are  doubtless  many  instances  where  the  exec- 
utors, administrators,  or  trustees  have  been  obliged  to 
pay  the  transfer  tax  and  interest  personally  by  reason 
of  their  having  distributed  the  estate  without  having 
made  provision  therefor,  yet  it  does  not  appear  that 
fiie  personal  liability  of  such  representatives  has  ever 
been  contested.  While  the  provision  is  broad  enough 
to  include  the  personal  liability  of  the  executor  or  ad- 


LIEN,    AND    COLLECTION    OF    TAX.  205 

ministrator  to  pay  a  transfer  tax  upon  the  transfer  of 
real  property  over  which  the  administrator  never,  and 
the  executor  seldom  has,  any  control  whatsoever,  ex- 
cept in  proceedings  to  sell  a  decedent's  real  estate  in 
payment  of  his  debts,  yet  it  would  seem  that  the  exec- 
utor or  administrator  in  a  proceeding  to  compel  him 
to  pay  such  a  tax  might,  as  stated  in  the  Matter  of  Mc- 
Pherson,  104  N.  Y.  306-323,  "  allege  any  reason  what- 
ever which  shows  that  he  ought  not  to  pay  the  tax," 
and  a  sufficient  reason  would  doubtless  be  that  he  had 
never  had  any  control  over  the  real  estate  upon  which 
the  tax  is  a  lien. 

224.  Tax  on  Transfer  of  Real  Estate  —  Not  to  be  Assessed 

Against  Executor. 

In  the  Matter  of  Hartmann,  N.  Y.  Law  Journal  of 
Feb.  8,  1904,  Surrogate  Fitzgerald  held  that  where 
the  real  estate  was  devised  directly  for  the  life  of  one 
beneficiary  with  remainder  in  fee  to  another,  that  the 
executor  takes  no  title  thereto  either  as  executor  or 
trustee,  and  that  the  taxation  thereof  against  the  latter 
is  improper,  and  the  matter  was  remitted  to  the  ap- 
praiser to  ascertain  and  report  the  respective  values 
of  these  interests  separately. 

225.  Sale  of  What  Property  to  Pay  Tax. 

The  authority  given  the  executor  to  enforce  collec- 
tion of  the  tax  by  a  sale  of  the  property,  while  the 
statute  (§  224)  mentions  the  property  as  that  "  of 
the  decedent,"  must  be  held  to  mean  not  the  prop- 
erty of  the  testator  indiscriminately,  for  then  property 
given  to  one  exempt  from  tax  might  be  seized  in  satis- 
faction, but  it  must  rather  be  held  to  mean  the  property 


206        THE  LAW  OF  TAXABLE  TRANSFERS. 

of  the  decedent  "  passing  "  to  the  beneficiary.    Mat- 
ter of  Hoyt,  37  Misc.  Rep.  720-724,  76  N.  Y.  S.  504. 

226.  Surrogate  Cannot  Decide  Executor's  Liability  to  Pay  Tax, 

on  Motion. 

The  surrogate  cannot,  on  motion  of  the  executor, 
decide  his  liability  to  pay  the  tax.  Matter  of  Farley, 
15  N.  Y.  St.  R.  727. 

227.  Administrator  Cannot  be  Sued  Individually  for  Transfer 

Tax  Withheld. 

Where  an  administrator  has,  with  the  consent  of  the 
next  of  kin,  withheld  a  sum  sufficient  to  pay  any  pos- 
sible demand  for  an  inheritance  tax,  and  agreed  to  re- 
turn it  to  the  next  of  kin  if  it  should  not  be  needed  for 
that  purpose,  he  cannot,  after  he  has  been  released  as 
administrator  by  the  next  of  kin,  and  a  decree  entered 
settling  the  estate,  be  sued  in  his  individual  capacity. 
The  administrator  still  retains  the  sum  as  admin- 
istrator and  his  liability  therefore  was  as  administrator 
only.  Thompson  v.  Thompson,  70  App.  Div.  242,  75 
N.  Y.  S.  401. 

228.  When  Executor's  Liability  Ends. 

It  was  held,  under  the  Act  of  1885,  that  after  the 
report  of  an  appraiser  had  been  duly  confirmed  and 
notice  given  the  city  comptroller,  the  State  could  not 
hold  the  executor  personally  liable  for  the  tax  on  lega- 
cies improperly  exempted  by  the  appraiser.  Matter  of 
Vanderbilt,  10  N.  Y.  S.  239. 

229.  Subrogation  —  For  the  Benefit  of  Creditors. 

When  it  appears  that  the  administrator  has  paid 
from  personalty  the  transfer  tax  on  realty  to  which 


REFUND    OF    TAX    ERRONEOUSLY    PAID.  207 

the  heirs  succeeded  under  the  decedent,  the  admin- 
istrator, in  partition  proceedings,  is  subrogated  to  that 
claim  for  the  benefit  of  creditors,  for  they  had  the  right 
to  the  application  of  such  personalty  to  the  payment 
of  their  debts.  It  seemed  the  administrator  or  the 
creditors  had  never  made  application  to  sell  such  real 
estate  to  pay  debts  within  the  three  years  under  the 
Code  of  Civil  Procedure,  section  2750.  Hughes  v. 
Golden,  44  Misc.  Rep.  128,  89  N.  Y.  S.  765. 

230.  Refund  of  Tax  Erroneously  Paid. 

[§  225,  Tax  Law.]  If  any  debts  shall  be  proven  against 
the  estate  of  a  decedent  after  the  payment  of  any  legacy  or 
distributive  share  thereof,  from  which  any  such  tax  has  been 
deducted  or  upon  which  it  has  been  paid  by  the  person  en- 
titled to  such  legacy  or  distributive  share,  and  such  person 
is  required  by  order  of  the  surrogate  having  jurisdiction,  on 
notice  to  the  state  comptroller,  to  refund  the  amount  of  such 
debts  or  any  part  thereof,  an  equitable  proportion  of  the  tax 
shall  be  repaid  to  him  by  the  executor,  administrator  or  trus- 
tee, if  the  tax  has  not  been  paid  to  the  state  comptroller  or 
county  treasurer ;  or  if  such  tax  has  been  paid  to  such  state 
comptroller  or  county  treasurer,  such  officer  shall  refund  out 
of  the  funds  in  his  hands  or  custody  to  the  credit  of  such 
taxes  such  equitable  proportion  of  the  tax,  and  credit  him- 
self with  the  same  in  the  account  required  to  be  rendered  by 
him  under  this  article.1  If  after  the  payment  of  any  tax  in 
pursuance  of  an  order  fixing  such  tax,  made  by  the  surrogate 
having  jurisdiction,  such  order  be  modified  or  reversed  within 

1.  Sec.  10,  Chap.  483,  Laws  1885  — in  effect  June  30  of  that  year.— 
Provided  for  a  refund  of  taxes  paid  whenever  debts  shall  be  proven 
against  the  estate  after  payment  of  any  tax.  Section  12  of  the  Act 
of  188.')  provided  for  the  return  of  tax  erroneously  paid,  upon  proof 
rendered  to  the  Comptroller  or  county  treasurer.  Sections  10  and  12 
aforesaid,  became  section  6  of  the  Act  of  1892,  and  section  225  of  the 
Act  of  1890. 


208  THE   LAW    OF    TAXABLE    TRANSFERS. 

two  years3  from  and  after  the  date  of  entry  of  the  order 
fixing  the  tax,  on  due  notice  to  the  state  comptroller,  the 
state  comptroller  shall,  if  such  tax  was  paid  in  a  county  in 
which  the  office  of  appraiser  is  salaried,  refund  to  the  exec- 
utor, administrator,  trustee,  person  or  persons  by  whom  such 
tax  has  been  paid,  the  amount  of  any  moneys  paid  or  de- 
posited on  account  of  such  tax  in  excess  of  the  amount  of  the 
tax  fixed  by  the  order  modified  or  reversed,  out  of  the  funds 
in  his  hands  or  custody  to  the  credit  of  such  taxes,  and  to 
credit  himself  with  the  same  in  the  account  required  to  be 
rendered  by  him  under  this  act,  or  if  paid  in  a  county  in 
which  the  office  of  appraiser  is  not  salaried,  he  shall  by  war- 
rant direct  and  allow  the  county  treasurer  of  the  county  to 
refund  such  amount  in  the  same  manner ;  but  no  application 
for  such  refund  shall  be  made  after  one  year  from  such  re- 
versal or  modification,  and  the  state  comptroller  shall  deduct 
from  the  fees  allowed  by  this  article  to  the  county  treasurer 
the  amount  theretofore  allowed  him  upon  such  overpayment.3 

Z-3.  Sec.  12,  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year.— 
The  State  Treasurer  was  authorized  to  refund  tax  erroneously  paid,  but 
application  must  be  made  within  two  years  from  date  of  payment. 

By  Chap.  713,  Laws  1887  —  in  effect  June  25  of  that  year.— The 
time  within  which  such  application  for  a  refund  must  be  made  was 
extended  to  five  years  from  date  of  payment. 

By  Sec.  6,  Chap.  399,  Laws  1892  — in  effect  May  1  of  that  year.— The 
State  Comptroller  was  authorized  to  refund  illegal  or  erroneous  taxes 
upon  satisfactory  proof  presented  to  him  within  five  years  from  pay- 
ment, and  this  provision  wa9  continued  in  section  225  of  chapter  908, 
Laws  1896. 

By  Chap.  284,  Laws  1897  —  in  effect  April  16  of  that  year.— The 
five-year  limitation  was  removed  and  from  that  time  until  April  11, 
1900,  there  was  no  limitation  within  which  the  application  for  refund 
must  be  made  after  the  payment  of  this  tax,  except  possibly  the  limita- 
tion provided  by  section  6  of  article  7  of  the  State  Constitution,  and  the 
limitation  that  no  application  for  a  refund  could  be  made  after  one 
year  from  the  reversal  or  modification  of  the  order  assessing  the  tax. 

By  Chap.  382,  Laws  1900  — in  effect  April  11  of  that  year. —  It  was 
provided  that  if  upon  due  notice  to  the  State  Comptroller  the  order 
assessing  tax  be  modified  or  reversed  within  two  years  from  and  after 
the  date  of  the  entry  of  the  order  fixing  the  tax,  the  State  Comptroller 
shall  allow  or  direct  a  refund,  etc.,  and  also  provided  that  no  applica- 
tion for  such  refund  shall  be  made  after  one  year  from  such  reversal 
or  modification  of  said  order.  See  Matter  of  Eoople,  179  N.  Y.  308, 
which  held  that  the  amendment  of  1900  {supra)  barred  all  claims  for 
refund  where  the  order  had  not  been  modified  or  reversed  within  two 
years  from  the  entry  thereof  and  that  this  provision  applied  to  orders 


REFUND  OF  TAX  ERRONEOUSLY  PAID.        209 

Where  it  shall  be  proved  to  the  satisfaction  of  the  surrogate 
that  deductions  for  debts  were  allowed  upon  the  appraisal, 
since  proved  to  have  been  erroneously  allowed,  it  shall  be 
lawful  for  such  surrogate  to  enter  an  order  assessing  the  tax 
upon  the  amount  wrongfully  or  erroneously  deducted.4 

231.  The  General  Subject. 

Section  225  of  chapter  368,  Laws  1905,  is  substan- 
tially the  same  as  section  225  of  the  Act  of  1896,  as 
amended  by  chapter  284,  Laws  1897 ;  chapter  382,  Laws 
1900,  and  chapter  173,  Laws  1901,  the  principal  amend- 
ment of  1905,  relating  to  the  manner  in  which  refunds 
in  the  counties  where  the  office  of  appraisers  are  not 
salaried  are  to  be  paid  when  the  order  fixing  the  tax 
has  been  modified  or  reversed  within  the  two-year 
limitation. 

232.  Provisions  of  this  Section  are  Exclusive. 

It  was  held  in  the  Matter  of  Howard,  54  Hun,  305, 
7  N.  Y.  S.  594,  that  the  remedy  provided  by  the  In- 
heritance Tax  Laws  of  1885  and  1887  for  securing  a 
refund  was  exclusive,  the  court  saying:  "  This  is  a 
simple  and  available  proceeding  afforded  to  the  party 
entitled  to  the  reimbursement  of  the  money  paid  for 
the  tax  and  it  was  without  doubt  intended  to  be  ex- 
clusive for  this  object."  To  same  effect,  see  Matter 
of  Hall,  27  N.  Y.  St.  R.  133,  7  N.  Y.  S.  595. 

233.  Power  of  Surrogate  to  Order  Refund. 

While  the  tax  remains  in  the  hands  of  the  county 
treasurer,  the  surrogate  may  direct  a  refund.    Matter 

filtered   prior  as  well   as   subsequently  to  chapter  382,   Laws   1900,   be- 
coming a  law.      (April  11  of  that  year.) 

4.  Chap.   284,   Laws    1897  —  in   effect   April    16   of   that  year.— This 
provision  was  first  added  to  section  225  by  the  amendment  "of  1897. 
14 


210  THE    LAW    OF    TAXABLE   TRANSFERS. 

of  Park,  8  Misc.  Rep.  550,  29  N.  Y.  S.  1081.  (Act  of 
1892.) 

Under  the  Act  of  1897,  in  effect  April  16th  of  that 
year,  there  was  no  limitation  as  to  the  time  within 
which  an  application  must  be  made  to  reverse  or 
modify  a  decree,  and  the  court  held  in  the  Matter  of 
Sherar,  25  Misc.  Rep.  138,  54  N.  Y.  S.  930,  that  such 
application  to  the  surrogate  for  a  refund  need  not  be 
made  within  two  years  from  the  date  of  entry  of  the 
order  fixing  the  tax,  as  section  1290  of  the  Code  of  Civil 
Procedure  did  not  apply,  and  that  the  only  limitation 
in  section  225  was  that  no  application  for  a  refund 
should  be  made  after  one  year  from  such  reversal  or 
modification  of  the  order. 

In  the  Matter  of  Knower,  N.  Y.  Law  Journal  of  Jan. 
16,  1904,  the  surrogate  of  New  York  county  held, 
upon  an  application  to  modify  an  order  on  a  basis 
which  deducts  from  the  value  of  the  estate  the  amount 
of  the  appraisal  of  certain  United  States  bonds,  that 
he  had  no  jurisdiction  to  adjudge  against  the  State 
Comptroller  that  he  shall  refund  or  pay  to  the  peti- 
tioner a  sum  of  money.  The  power  to  make  such  an 
adjudication  is  vested  in  the  Supreme  Court. 

234.  Refund  —  Debt  Subsequently  Discovered. 

The  surrogate  has  no  power  to  modify  a  decree  as- 
sessing a  transfer  tax  which  has  not  been  appealed 
from,  and  allow  a  refund  of  a  part  of  the  tax  at  the 
instance  of  the  executor,  who  has  since  discovered  an- 
other debt  against  the  estate.  Matter  of  Hamilton,  41 
Misc.  Rep.  268,  84  N.  Y.  S.  44. 


REFUND   OF    TAX    ERRONEOUSLY    PAID.  211 

235.  Refund  After  Time  to  Appeal  Has  Expired. 

In  the  Matter  of  Coogan,  27  Misc.  Rep.  563,  59  X.  Y. 
S.  Ill;  affd.,  45  App.  Div.  628,  61  N.  Y.  S.  1144,  162 
N.  Y.  613,  which  was  an  application  for  a  peremptory 
writ  of  mandamus  against  the  State  Comptroller,  it 
was  held  that  the  surrogate  has  power  under  section 
225  of  chapter  908,  Laws  1896,  as  amended  by  chapter 
284,  Laws  1897,  to  modify  his  order  and  direct  the  tax 
to  be  refunded,  although  the  time  to  appeal  had  ex- 
pired, as  its  original  imposition  was  without  jurisdic- 
tion, and  thereafter  the  Supreme  Court  will,  by  man- 
damus, compel  the  State  Comptroller  to  procure  the 
refund  to  be  made. 

236.  The  Two- Year  Limitation  —  Chap.  382,  Laws  1900. 
The  most  important  decision  affecting  the  refunding 

of  transfer  taxes  erroneously  paid,  and  one  which 
affected  a  large  number  of  estates  in  each  county  where 
a  transfer  tax  had  been  assessed  and  paid  upon  United 
States  bonds  between  the  years  1892  and  1898,  was  the 
recent  decision  of  the  Court  of  Appeals  in  the  Matter 
of  Hoople,  179  N.  Y.  308. 

A  decree  was  entered  by  the  surrogate  of  Queens 
county  on  November  29,  1895,  assessing  a  transfer  tax 
upon  the  estate  of  William  G.  Hoople  under  the  pro- 
visions of  chapter  399,  Laws  1892.  A  part  of  his  es- 
tate consisted  of  United  States  bonds  which  were  in- 
cluded in  the  property  upon  which  the  tax  was  based, 
and  the  tax  was  paid  by  the  executors  November  29, 
1895.  Shortly  thereafter  the  Court  of  Appeals  in  the 
Matter  of  Whiting,  1.50  N.  Y.  27,  and  Matter  of  Sher- 
man, 153  N.  Y.  1,  decided  that  United  States  bonds 


212  THE   LAW    OF    TAXABLE    TRANSFERS. 

could  not  be  subjected  to  a  transfer  tax  under  the  Act 
of  1892,  section  22  of  which  denned  the  word  "  prop- 
erty "  to  include  property  "  *  *  over  which  this 
State  has  any  jurisdiction  for  the  purposes  of  taxa- 
tion." 

No  application  was  made  for  a  refund  in  this  case 
until  October,  1903,  eight  years  after  entry  of  the  order 
and  the  payment  of  the  tax,  when  the  executors  peti- 
tioned the  surrogate  of  Queens  county  to  vacate  that 
part  of  his  former  order  which  assessed  a  tax  upon 
the  transfer  of  the  United  States  bonds.  The  petition 
was  granted  and  the  surrogate,  by  order,  directed  the 
State  Comptroller  to  refund  to  the  estate  that  portion 
of  the  tax  which  amounted  to  $660.  The  Appellate 
Division  (93  App.  Div.  486,  87  N.  Y.  S.  842)  affirmed 
the  surrogate's  order,  holding  that  chapter  382,  Laws 
1900,  which  provides  that  if  within  two  years  from  the 
entry  of  an  order  fixing  tax  it  should  be  modified  or 
reversed,  refund  should  be  made,  was  not  retroactive 
and  therefore  only  applied  to  orders  entered  subse- 
quent to  its  passage. 

The  Court  of  Appeals  reversed  the  Appellate  Divi- 
sion, saying: 

It  is  a  fundamental  principle  of  our  jurisprudence  that  no 
action  will  lie  against  a  sovereign  State,  or  any  of  its  officers, 
to  enforce  an  obligation  of  the  State  without  express  legis- 
lative permission  {People  v.  Dennison,  84  N.  Y.  272 ;  Lewis 
v.  State  of  N.  Y.,  96  N.  Y.  71 ;  Locke  v.  State  of  N.  Y.,  140 
N.  Y.  480;  Smith  v.  Reeves,  178  U.  S,  436;  Flagg  v.  Brad- 
ford, 181  Mass.  315)  :  and  when  a  State  does  abdicate  thir, 
attribute  of  sovereignty  and  permits  itself  to  be  sued,  the 
citizen  who  benefits  by  such  an  act  of  grace  acquires  no 
vested   right   thereby,   but   simply   a   privilege   voluntarily 


BEFUND    OF    TAX    ERRONEOUSLY    PAID.  213 

granted  by  the  State,  which  may  be  hedged  about  with  terms 
and  conditions,  and  may  be  withdrawn  as  freely  as  it  was 
given.  Beers  v.  Arkansas,  20  How.  (U.  S.)  527;  Pannenter 
v.  State  of  N.  Y.,  135  N.  Y.  154;  Baltzer  v.  North  Carolina, 
161  U.  S.  240;  Railroad  Co.  v.  Tennessee,  101  U.  S.  337; 
Railroad  Co.  v.  Alabama,  101  IT.  S.  832. 

In  the  light  of  these  principles  it  is  obvious  that  the  stat- 
utes under  discussion  (chap.  399,  Laws  1892 ;  chap.  284, 
Laws  1897 ;  chap.  382,  Laws  1900)  invested  the  respondent 
with  no  absolute  right,  but  conferred  upon  him  a  mere  privi- 
lege, the  extent  and  duration  of  which  depended  entirely 
upon  the  language  conferring  it.* 

237.  When  Interest  Attaches  to  a  Refund. 

In  the  Matter  of  O' Berry,  179  N.  Y.  285-291,  the 
court  held  that  the  amount  of  transfer  tax  imposed 
upon  an  estate  in  remainder  under  an  unconstitutional 
law,  and  paid  by  the  executor  is  recoverable  with  in- 

*  The  decree  in  the  Hoople  Case  was  entered  November  29,  1895,  when 
chapter  399,  Laws  1892,  was  in  force,  which  authorized  the  Comptroller, 
upon  satisfactory  proof,  to  refund  tax  erroneously  or  illegally  paid, 
provided  application  for  such  refund  was  made  within  five  years  from 
payment. 

In  1897  (chap.  284)  (§  225,  formerly  §  6),  was  amended  so  as  to 
confer  upon  the  surrogate  the  power  to  modify  or  reverse  an  order  by 
directing  a  refund  of  the  moneys  paid,  but  no  application  for  such 
refund  should  be  made  after  one  year  from  such  reversal  or  modification. 
The  provision  just  quoted  does  not  limit  the  time  within  which  the 
order  could  be  modified  or  reversed,  but  provided  that  application  for 
refund  must  be  made  within  one  year  from  such  reversal  or  modification. 

April  11,  1900,  chapter  382  provided  that  if  within  two  years  from 
the  entry  of  an  order  fixing  tax  it  should  be  modified  or  reversed  by 
the  proper  surrogate,  refund  should  be  made  if  application  therefor 
was  made  within  one  year  from  such  reversal  or  modification. 

The  court  further  held  that  if  the  provisions  of  1900  did  not  apply 
to  this  case  that  the  respondent  would  be  barred  by  section  6  of  article 
7  of  the  Constitution,  which  provides  that  "neither  the  Legislature, 
the  canal  board,  nor  any  person  or  persons  acting  in  behalf  of  the  State, 
shall  audit,  allow,  or  pay  any  claim  which  as  between  citizens  of  the 
State  would  l>e  barred  by  lapse  of  time."  An  action  for  the  recovery 
of  money  paid  by  reason  of  an  illegal  or  erroneous  tax  is  regarded  as 
ail  action  for  money  had  and  received,  to  which  the  six  j'ears'  statute 
of  limitation  applies.  Brundaqe  v.  Village  Port  Chester,  102  N.  Y. 
401;   Trimmer  v.  City  of  Rochester,  134  N.  Y.  76. 


214        THE  LAW  OF  TAXABLE  TRANSFERS. 

terest,  although  section  225  makes  no  mention  of  re- 
funding the  tax  with  interest. 

In  this  case  a  certain  remainder  interest,  which  it 
was  conceded  vested  in  1884,  was,  upon  the  death  of 
the  life  tenant  in  1901,  held  taxable  under  the  pro- 
visions of  chapter  76,  Laws  1899,  and  the  tax  paid. 
Subsequently  the  Court  of  Appeals  held  that  a  transfer 
tax  upon  remainders  which  vested  prior  to  the  law  tax- 
ing such  interests  was  void.  Matter  of  Pell,  171  N.  Y. 
48.  The  application  to  vacate  the  order  and  direct  a 
refund  was  not  opposed,  but  objection  was  made  to  the 
payment  of  interest,  and  an  appeal  was  taken  only 
from  so  much  of  the  order  as  directs  the  payment  of 
interest  upon  the  amount  to  be  refunded.  The  Court 
of  Appeals  held  that  when  either  the  State  or  one  of  its 
cities  or  political  divisions,  becomes  liable  by  statute 
or  otherwise  to  ' '  refund  ' '  a  tax  paid  which  was  illegal 
or  void,  the  right  to  interest  follows  without  any  ex- 
press provision  on  the  subject.  Citing  Matter  of 
Scrimgeour,  175  N.  Y.  507,  affg.  80  App.  Div.  388,  80 
N.  Y.  S.  636,  and  39  Misc.  Rep.  128,  78  N.  Y.  S.  971. 

238.  Order  Need  not  Direct  Comptroller  to  Refund. 

The  surrogate  may  properly  refuse  to  insert  in  the 
order  vacating  the  transfer  tax  imposed  upon  the  es- 
tate a  direction  to  the  State  Comptroller  to  refund  the 
amount  of  the  tax,  as  the  statute  itself  directs  the  re- 
funding of  the  tax  in  such  a  case.  (L.  1896,  chap.  908, 
§  225,  as  amd.  by  chap.  284,  L.  1897.)  Matter  of 
Cameron,  97  App.  Div.  436,  89  N.  Y.  S.  977;  affd.,  181 
N.  Y.  Mem.  49,  without  opinion. 


REFUND    OF    TAX    ERRONEOUSLY    PAID.  215 

239.  Right  to  Refund  is  not  a  Vested  Right. 

The  right  to  a  refund  of  illegal  tax  is  a  privilege  and 
not  a  vested  right,  and  since  the  amendment  to  section 
225  by  chapter  382,  Laws  1900,  in  effect  April  11th  of 
that  year,  application  to  modify  or  reverse  the  order 
fixing  the  tax  must  be  made  within  two  years  from  and 
after  the  entry  of  such  order,  on  due  notice  to  the  State 
Comptroller,  and  the  application  for  such  refund  must 
be  made  within  one  year  from  such  reversal  or  modi- 
fication of  said  order.  Matter  of  Hoople,  179  N.  Y. 
308,  revg.  93  App.  Div.  486,  87  N.  Y.  S.  842. 

240.  Taxing  Debts,  Etc.,  Erroneously  Allowed. 

The  last  clause  of  section  225  authorizes  the  surro- 
gate to  enter  an  order  assessing  a  tax  upon  the  amount 
of  debts  wrongfully  or  erroneously  allowed  and  de- 
ducted upon  the  appraisal.  This  provision  points  out 
the  way  to  avoid  inequitable  results  and  conflicting  de- 
termination in  making  deduction  for  debts  and  ex- 
penses of  administration  in  advance  and  before  the 
exact  amount  is  definitely  known.  Matter  of  Dimon, 
82  App.  Div.  107-110,  81  N.  Y.  S.  428.  As  to  this  pro- 
vision being  res  adjudicata  as  to  the  debts  and  ex- 
penses allowed  in  the  proceedings  before  the  appraiser 
where  no  appeal  has  been  taken,  see  Matter  of  Rice,  56 
App.  Div.  253-258,  61 N.  Y.  S.  911,  68  N.  Y.  S.  1147,  and 
cases  cited. 


CHAPTER  XI. 

Bequests  in  Lieu  of  Commissions  —  Liability  of  Cer- 
tain Corporations  to  Tax. 


241.  Taxes    upon    devises    and    be- 

quests   in    lieu    of    commis- 
sions. 

242.  Tax   on   legacy   to   executors ; 

subsequently  renounced. 

243.  Former  section  226  relating  to 

deferred    payments    omitted 
from  Act  of  1905. 

244.  Effect  of  electing  to  defer  pay- 

ment after  Chapter  76,  Laws 
1899. 

245.  Liability    of    certain    corpora- 

tions to  tax. 


246.  Provisions     of    this     section; 

generally  complied  with. 

247.  Consent     of     Comptroller     to 

transfers;  how  obtained. 

Corporations  transfer  at  their 
peril;  when. 

Obligation  to  give  the  notice 
rests  upon  the  bank  or  other 
depository. 
250.  Corresponding  provision  of 
former  statute  relating  to 
the  liability  of  certain  cor- 
porations to  tax. 


248. 


>49. 


241 .  Taxes  Upon  Devises  and  Bequests  in  Lien  of  Commissions. 

[§  226,  Tax  Law.]  If  a  testator  bequeaths  or  devises  prop- 
erty to  one  or  more  executors  or  trustees  in  lieu  of  their 
commissions  or  allowances,  or  makes  them  his  legatees  to  an 
amount  exceeding  the  commissions  or  allowances  prescribed 
by  law  for  an  executor  or  trustee,  the  excess  in  value  of  the 
property  so  bequeathed  or  devised,  above  the  amount  of  com- 
missions or  allowances  prescribed  by  law  in  similar  cases 
shall  be  taxable  under  this  article.1 


T Former  section  226  relating  to  "deferred  payments"  was  omitted 
from  chapter  368.  Laws    1905.] 

1.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year. —  Section  3 
contained  a  provision  taxing  the  excess  of  a  legacy  to  an  executor 
over  and  above  his   statutory  commissions. 

Chap.  399,  Laws  1892  —  in  effect  May  1  of  that  year. —  Section  8 
contained  a  similnr  provision. 

Chap.  908,  Laws  1896  — in  effect  June  15  of  that  year.— Section  227 
re-enacted  the  provisions  of  section  8,  Laws  1892,  which  were  sub- 
stantially re-enacted  by  chapter  368,  Laws  1905,  in  effect  June  1  of 
that  year. 

[216] 


BEQUESTS    IN    LIEU    OF    COMMISSIONS.  217 

242.  Tax  on  Legacy  to  Executors  —  Subsequently  Renounced. 

Where  a  legacy  is  given  to  executors  who  are  unre- 
lated to  decedent  and  who,  by  instruments  in  writ- 
ing, renounce  the  same  eight  months  after  the  dece- 
dent's death,  such  legacy  then  becomes  a  part  of  the 
testator's  residuary  estate,  and  the  relationship  of  the 
decedent's  residuary  legatees  will  determine  the  rate 
of  the  tax.  Matter  of  Wolfe,  89  App.  Div.  349,  85  N.  Y. 
S.  949;affd.,  179  N.  Y.  599. 

243.  Former    Section    226    Relating    to    Deferred    Payments 

Omitted   from   Act    of    1905. 

Former  section  226  of  the  Act  of  1896,  as  amended  by 
chapter  284,  Laws  1897,  relative  to  "  deferred  pay- 
ments," was  omitted  from  chapter  368,  Laws  1905. 
Former  section  226  provided  as  follows  : 

§  226.  Deferred  payment. —  Any  person  or  corporation 
beneficially  interested  in  any  property  chargeable  with  a  tax 
under  this  article,  and  executors,  administrators  and  trustees 
thereon  may  elect  within  eighteen  months  from  the  date  of 
the  transfer  thereof  as  herein  provided,  not  to  pay  such  tax 
until  the  person  or  persons  beneficially  interested  therein 
shall  come  into  the  actual  possession  or  enjoyment  thereof. 
If  it  be  personal  property,  the  person  or  persons  so  electing 
shall  give  a  bond  to  the  state  in  penalty  of  three  times  the 
amount  of  any  such  tax,  with  such  sureties  as  the  surrogate 
of  the  proper  county  may  approve,  conditioned  for  the  pay- 
ment of  such  tax  and  interest  thereon,  at  such  time  or  period 
as  the  person  or  persons  beneficially  interested  therein  may 
come  into  actual  possession  or  enjoyment  of  such  property, 
which  bond  shall  be  filed  in  the  office  of  the  surrogate.  Such 
bond  must  be  executed  and  filed  and  a  full  return  of  such 
property  upon  oath  made  to  the  surrogate  within  one  year 


218        THE  LAW  Or  TAXABLE  TKANSFERS. 

from  the  date  of  transfer  thereof  as  herein  provided,  and 
such  bond  must  be  renewed  every  five  years. 

Since  the  enactment  of  chapter  76,  Laws  1899,  in 
effect  March  14th  of  that  year  and  amending  section 
230  of  the  Act  of  1896,  by  requiring  the  immediate  ap- 
praisal of  future  and  contingent  estates  and  the  pay- 
ment of  the  tax  forthwith  out  of  the  property  trans- 
ferred, it  is  apparent  that  this  section  has  become  obso- 
lete. See  Matter  of  Tracy,  179  N.  Y.  501,  as  to  the  pro- 
vision of  chapter  76,  Laws  1899,  applying  to  vested  as 
well  as  contingent  estates. 

244.  Effect  of  Electing  to  Defer  Payment  After  Chapter  76, 
Laws  1899. 

In  the  Matter  of  Hamilton,  N.  Y.  Law  Journal  of 
May  27,  1903,  the  only  taxable  transfers  made  by  the 
decedent's  will  were  certain  remainder  interests  in  real 
estate  and  an  annuity  chargeable  thereon.  The  dece- 
dent died  in  1901,  and  in  transfer  tax  proceedings 
upon  said  estate  the  value  of  such  interests  were  ap- 
praised and  the  tax  assessed  thereon.  The  taxable 
beneficiaries  filed  elections,  as  provided  by  former  sec- 
tion 226,  relating  to  deferred  payments  and  then  moved 
before  Surrogate  Fitzgerald,  one  of  the  surrogates  of 
New  York  county,  for  an  order  adjudging  that  said  tax 
so  fixed  and  determined,  "  need  not  be  paid  until  the 
persons  beneficially  interested  in  the  estate  and  interest 
in  said  property  on  which  said  taxes  are  chargeable 
shall  come  into  the  actual  possession  and  enjoyment  of 
such  interests  respectively,  and  that  the  interest  on 
said  taxes,  when  the  same  shall  become  due  and  pay- 
able, shall  be  at  the  rate  of  6  per  cent,  per  annum  from 


LIABILITY   OF    CERTAIN    CORPORATIONS.  219 

the  date  of  death  until  the  time  of  payment."  The 
surrogate  held  that  inasmuch  as  the  efficacy  of  the  elec- 
tions had  not  been  attacked,  the  question  presented 
could  not  be  determined  on  a  motion  therefor.  Until 
the  State  Comptroller  asserts,  in  a  proceeding  insti- 
tuted through  the  district  attorney  in  the  manner  pro- 
vided by  section  235  of  the  act  that  the  tax  upon  the 
interests  in  remainder  is  payable,  and  that  the  filing  of 
the  elections  is  ineffectual  to  postpone  payment,  a  dis- 
position of  the  legal  issue  is  premature. 

245.  Liability  of  Certain  Corporations  to  Tax. 

[§  227,  Tax  Law.]  If  a  foreign  executor,  administrator  or 
trustee  shall  assign  or  transfer  any  stock  or  obligations  in 
this  state  standing  in  the  name  of  a  decedent,  or  in  trust  for 
a  decedent,  liable  to  any  such  tax,  the  tax  shall  be  paid  to 
the  state  comptroller  or  the  treasurer  of  the  proper  county 
on  the  transfer  thereof.1  No  safe  deposit  company,  trust 
company,  corporation,  bank  or  other  institution,  person  or 
persons  having  in  possession  or  under  control  securities,  de- 
posits, or  other  assets  belonging  to  or  standing  in  the  name 
of  a  decedent  who  was  a  resident  or  nonresident,  or  belonging 
to,  or  standing  in  the  joint  names2  of  such  a  decedent  and 
one  or  more  persons,  including  the  shares  of  the  capital 
stock  of,  or  other  interests  in,  the  safe  deposit  company,  trust 
company,  corporation,  bank  or  other  institution  making  the 
delivery  or  transfer  herein  provided,  shall  deliver  or  transfer 
the  same  to  the  executors,  administrators  or  legal  representa- 
tives of  said  decedent,  or  to  the  survivor  or  survivors  when 

[Former  section  228  related  to  the  liability  of  certain  corporations  to 
tax.  J 

1.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year. —  Section 
1 1  referred  to  the  payment  of  the  tax  by  the  foreign  executor  on  the 
transfer  of  any  stocks  or  loans  in  this  State. 

2.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year.— Added 
the  proviso  in  reference  to  the  transfer  of  stocks  or  securities  standing 
in  "  joint  names  "  of  the  decedent  and  one  or  more  persons,  wherever 
reference  is  made  thereto  in  section  227. 


220  THE   LAW    OF    TAXABLE    TRANSFERS. 

held  in  the  joint  names  of  a  decedent  and  one  or  more  per- 
sons, or  upon  their  order  or  request,  unless  notice  of  the  time 
and  place  of  such  intended  delivery  or  transfer  be  served 
upon  the  state  comptroller3  at  least  ten  days4  prior  to  said 
delivery  or  transfer ;  nor  shall  any  such  safe  deposit  com- 
pany, trust  company,  corporation,  bank  or  other  institution, 
person  or  persons  deliver  or  transfer  any  securities,  deposits 
or  other  assets  belonging  to  or  standing  in  the  name  of  a  de- 
cedent, or  belonging  to,  or  standing  in  the  joint  names  of  a 
decedent  and  one  or  more  persons,  including  the  shares  of  the 
capital  stock  of,  or  other  interests  in,  the  safe  deposit  com- 
pany, trust  company,  corporation,  bank  or  other  institution 
making  the  delivery  or  transfer,  without  retaining  a  suf- 
ficient portion  or  amount  thereof  to  pay  any  tax  and  interest 
which  may  thereafter  be  assessed  on  account  of  the  delivery 
or  transfer  of  such  securities,  deposits  or  other  assets,  includ- 
ing the  shares  of  the  capital  stock  of,  or  other  interests  in, 
the  safe  deposit  company,  trust  company,  corporation,  bank 
or  other  institution  making  the  delivery  or  transfer,  under 
the  provisions  of  this  article,  unless  the  state  comptroller  con- 
sents thereto  in  writing.5  And  it  shall  be  lawful  for  the  said 
state  comptroller,  personally  or  by  representative,  to  examine 
said  securities,  deposits  or  assets  at  the  time  of  such  delivery 
or  transfer.6    Failure  to  serve  such  notice  or  failure  to  allow 

3.  Chap.  173,  Laws  1901  —  in  effect  April  1  of  that  year. —  Notice  of 
transfer  of  stocks,  etc.,  was  required  to  be  served  on  the  State  Comp- 
troller. 

4.  Chap.  173,  Laws  1901  —  in  effect  April  1  of  that  year. —  Extended 
the  time  of  giving  notice  of  intended  transfer  from  five  days  to  at 
least  "  ten  "  days  prior  to  such  transfer. 

5.  Chap.  173,  Laws  1901  —  in  effect  April  1  of  that  year.— Added 
the  provision  in  reference  to  the  safe-deposit  company,  bank,  or  other 
institution  retaining  a  sufficient  amount  to  pay  any  transfer  tax  on 
the  funds,  securities,  or  other  assets  of  a  nonresident,  unless  the  State 
Comptroller  consents  thereto  in  writing. 

6.  Chap.  399,  Laws  1892  —  in  effect  May  1  of  that  year. —  Section  9 
re-enacted  the  provision  of  section  11  of  the  Act  of  1885  (supra),  and 
also  provided  that  no  bank,  safe-deposit  company,  etc.,  should  transfer 
any  funds  or  securities  of  a  deceased  person  unless  at  least  five  days' 
notice  was  served  upon  the  county  treasurer  or  Comptroller  prior  to 
such  transfer.  The  county  treasurer  or  Comptroller  were  also  author- 
ized personally  or  by  representative  to  examine  said  securities  and 
assets  at  the  time  of  the  delivery  thereof.    This  provision  became  part 


LIABILITY   OF    CERTAIN    CORPORATIONS.  221 

such  examination,  or  failure  to  retain  a  sufficient  portion  or 
amount  to  pay  such  tax  and  interest  as  herein  provided  shall 
render  said  safe  deposit  company,  trust  company,  corpora- 
tion, bank  or  other  institution,  person  or  persons  liable  to  the 
payment  of  the  amount  of  the  tax  and  interest  due  or  there- 
after to  become  due  upon  said  securities,  deposits  or  other 
assets,  including  the  shares  of  the  capital  stock  of,  or  other 
interests  in,  the  safe  deposit  company,  trust  company,  cor- 
poration, bank  or  other  institution  making-  the  delivery  or 
transfer,7  and  in  addition  thereto,  a  penalty  of  one  thousand 
dollars  ;8  and  the  payment  of  such  tax  and  interest  thereon, 
or  of  the  penalty  above  prescribed,  or  both,  may  be  enforced 
in  an  action  brought  by  the  state  comptroller  in  any  court  of 
competent  jurisdiction.9 

of  section  228  by  chapter  908,  Laws  1896,  in  effect  June  15th  of  that 
year,  and  by  chapter  173,  Laws  1901,  the  State  Comptroller  personally 
or  by  representative  was  allowed  to  examine  such  securities,  etc. 

7.' Chap.  483,  Laws  1885  — in  effect  June  30  of  that  year.— Provided 
that  any  corporation  permitting  such  transfer  shall  become  liable  to  pay 
such  tax  "  provided  that  such  corporation  has  knowledge  before  such 
transfer  that  said  stocks  are  liable  to  said  tax." 

By  (hap.  399,  Laws  1892  —  in  effect  May  1  of  that  year. —  Section  9 
provided  that  failure  to  serve  such  notice  or  allow  such  examination 
would  render  the  institutions,  corporations,  person,  or  persons  liable 
for  the  payment  of  tax  on  the  securities  or  assets,  and  this  provision 
was  re-enacted  in  section  228  of  chapter  908,  Laws  1896. 

By  Chap.  173,  Laws  1901 — in  effect  April  1  of  that  year. —  Failure 
to  retain  a  sufficient  amount  to  pay  the  tax  shall  also  render  the  in- 
stitution, corporation,  person,  or  persons  liable  for  the  payment  of  any 
tax  as  aforesaid. 

By  Chap.  101,  Laws  1902  —  in  effect  March  6  of  that  year.— Failure 
to  give  the  notice,  allow  the  examination  by  the  State  Comptroller,  or 
retain  sufficient  to  pay  the  tax  rendered,  the  safe-deposit  company, 
and  others  mentioned  in  the  section,  liable  to  the  payment  of  "  three 
times"  the  amount  of  tax  and  penalty  due,  or  thereafter  to  become 
due.  upon   such  securities  and  assets. 

8.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  Provides 
that  failure  to  give  such  notice,  etc.,  shall  render  the  trust  company 
and  others  named  liable  to  the  payment  of  this  tax  and  interest  due 
or  to  become  due  on  such  securities  and  assets,  "and  in  addition 
thereto,  a  penalty  of  one  thousand  dollars." 

9.  Chap.  101,  Laws  1902  —  in  effect  March  6  of  that  year. —  Pro- 
vided that  the  payments  of  three  times  the  amount  of  tax  and  penalty 
d\ie  by  the  trust  company  and  others  named,  should  be  enforced  in  an 
action  brought  in  accordance  with  section  235  of  the  Act  of  1896. 

Chap.  3(18,  Law's  1905  —  in  effect  June  1  of  that  year. —  Provides 
for  the  enforcement  of  the  payment  of  any  tax  and  the  penalty  in  ad- 
dition thereto  by  an  action  brought  by  the  State  Comptroller  in  any 
court  of  competent  jurisdiction. 


222  THE    LAW    OF   TAXABLE    TRANSFERS. 

246.  Provisions  of  this  Section  Generally  Complied  With. 
There  is  no  reported  case  where,  under  the  former 

provisions  of  the  statute,  a  safe-deposit  company  or 
other  institution  or  person  mentioned  in  this  section 
has  been  called  upon  to  pay  the  tax  by  reason  of  any 
failure  to  observe  the  requirements  of  this  section,  and 
a  general  compliance  with  the  provisions  of  former 
section  228  of  the  Act  of  1896,  as  amended  to  June  1, 
1905,  has  been  observed  by  safe-deposit  companies, 
trust  companies,  and  the  others  named. 

247.  Consent  of  Comptroller  to  Transfers  —  How  Obtained. 
It  is  the  practice  in  reference  to  the  estates  of  resi- 
dent decedents  for  the  Comptroller  to  give  a  written 
consent  for  the  transfer  of  funds  in  bank,  and  stocks, 
bonds,  or  other  securities  as  soon  as  the  executor  or 
administrator  has  qualified  and  application  is  made 
therefor  by  such  representative  or  by  the  depositories 
named,  and  in  case  it  is  desired  to  transfer  the  con- 
tents of  a  safe-deposit  box,  the  Comptroller  will  have 
a  representative  present  to  examine  the  contents  of 
such  box  and  will  consent  in  writing  to  the  transfer 
thereof  to  the  proper  representative.  In  the  case  of 
nonresident  decedents,  where  ancillary  letters  have  not 
been  issued  by  a  surrogate  of  this  State,  the  consent  of 
the  Comptroller  for  the  delivery  or  transfer  of  the 
securities,  etc.,  is  withheld  until  the  question  of  the 
taxability  of  the  property  within  this  State  is  deter- 
mined, and  if  taxable,  the  tax  paid,  after  which  the 
written  consent  to  transfer  each  security,  or  deposit, 
will  be  given. 


LIABILITY  OF   CERTAIN   CORPORATIONS.  223 

24&  Corporations  Transfer  at  their  Peril,  When. 

In  the  Matter  of  Romaine,  127  N.  Y.  80-86,  under 
the  provisions  of  the  Act  of  1887,  the  court  stated  that 
it  appears  from  the  provisions  of  the  act,  whenever 
any  foreign  executor  or  administrator  shall  assign  or 
transfer  any  stocks  or  loans  in  this  State  standing  in 
the  name  of  a  decedent,  the  tax  shall  be  paid  to  the 
proper  officer  on  such  transfer,  or  the  corporation 
permitting  it  shall  become  liable  to  pay  the  tax  pro- 
vided it  had  knowledge  of  the  facts  in  time;  that  it 
was  clear  that  the  act  is  not  confined  to  real  estate, 
but  embraces  personal  property  also  and  includes  evi- 
dences of  debts,  and  "  all  administrators  are  made 
liable  for  the  tax,  and  corporations  can  transfer  stock 
standing  upon  their  books  in  the  name  of  a  nonresi- 
dent decedent  only  at  their  peril,  until  the  tax  is  paid." 

248.  Obligation  to  Give  the  Notice  Rests  Upon  the  Bank  or 
Other  Depository. 

The  obligation  to  give  the  notice  to  the  State  Comp- 
troller rests  upon  the  bank  or  other  custodian,  and 
not  upon  the  representative  of  the  estate. 

In  the  Matter  of  Rathbone  v.  Bank  of  the  Metropolis. 
N.  Y.  Law  Journal  of  June  15,  1904,  the  bank  refused 
to  turn  over  moneys  deposited  to  the  executor  of  the 
estate,  contending  that  they  were  justified  in  not  doing 
so  because  the  plaintiff  had  failed  to  give  the  notice 
to  the  State  Comptroller  of  the  application  to  with- 
draw the  funds,  and  the  court  said:  "  Under  section 
228  of  chapter  908  of  the  Laws  of  1896,  as  amended  by 
chapter  101,  Laws  of  1902,  the  obligation  to  give  the 


224  THE    LAW    OF    TAXABLE    TRANSFEES. 

notice  of  delivery  or  transfer  of  deposits,  etc.,  there 
required  to  be  given  to  the  State  Comptroller,  rests 
upon  the  bank  and  not  upon  the  plaintiff.  As  soon 
as  the  demand  on  the  bank  is  made  it  should  determine 
whether  or  not  it  will  make  a  delivery  or  payment. 
If  it  decides  to  pay,  it  should  then  notify  the  State 
Comptroller  of  its  intention  to  do  so,  as  provided  in 
the  statute  referred  to.  For  these  reasons  I  think 
the  plaintiff  is  not  bound  either  to  give  the  notice  re- 
ferred to  or  to  prove  that  it  was  given.  The  failure 
of  the  bank  to  perform  a  duty  in  this  respect  imposed 
by  statute  cannot  affect  the  right  of  the  plaintiffs  to 
recover. ' ' 

It  is  customary  with  many  of  the  banks  and  safe- 
deposit  companies,  where  two  or  more  persons  rent  a 
box  in  their  joint  names,  to  make  a  contract  with  such 
persons,  that  either  of  said  persons  or  the  survivor 
shall  have  uninterrupted  access  to  the  deposit  box,  and 
the  amendment  of  1905  will  doubtless  change  this  prac- 
tice. 

250.  Corresponding  Provisions  of  Former  Statutes;  Relative 
to  the  Liability  of  Certain  Corporations  to  Tax. 

Section  11  of  the  Act  of  1885  provided  that,  whenever 
a  foreign  executor  or  administrator  should  transfer 
any  stocks  or  loans  in  this  State  liable  to  tax,  such 
executor  or  administrator  shall  pay  the  tax ;  or  other- 
wise the  corporation  permitting  such  transfer  shall  be 
liable  for  the  tax,  provided  that  such  corporation  had 
knowledge  before  such  transfer  that  said  stocks  or 
loans  were  liable  to  said  tax.    Section  9  of  the  Act  of 


LIABILITY   OF    CERTAIN    CORPORATIONS.  225 

1892  contained  a  similar  provision  in  reference  to  the 
foreign  executor,  administrator,  or  trustee  paying  the 
tax,  and  further  provided  that  no  safe-deposit  com- 
pany, bank,  or  other  institution,  person  or  persons 
holding  securities  or  assets  of  a  decedent  shall  deliver 
the  same  to  such  representatives,  unless  five  days'  no- 
tice of  such  intended  delivery  is  given  the  county 
treasurer  or  Comptroller,  who  had  the  right  to  ex- 
amine said  securities  or  assets  personally  or  by  repre- 
sentative at  the  time  of  such  delivery.  Failure  to  secure 
such  notice  or  allow  the  examination  made  the  safe- 
deposit  company  and  others  named  liable  to  the  pay- 
ment of  any  tax  upon  such  securities  or  assets,  and 
this  same  provision  became  section  228  of  the  Act  of 
1896. 

Former  section  228,  as  amended  by  chapter  173, 
Laws  1901,  in  effect  April  1st  of  that  year,  provided 
that  the  payment  of  tax  by  such  foreign  executor  and 
others  named  should  be  made  to  the  treasurer  of  the 
proper  county  or  the  State  Comptroller,  and  that  no 
safe-deposit  company,  bank,  etc.,  should  deliver  any 
securities  or  assets  of  a  decedent  without  serving  upon 
the  State  Comptroller  a  notice  of  the  time  and  place  of 
such  intended  transfer  at  least  ten  days  prior  thereto, 
and  provided  further  that  such  safe-deposit  company, 
etc.,  should  not  deliver  any  securities  or  assets  of  a 
)ion  resident  decedent  without  retaining  a  sufficient 
amount  thereof  to  pay  any  tax  thereafter  assessed 
upon  such  assets,  unless  the  State  Comptroller  con- 
sent thereto  in  writing.  Failure  to  give  the  notice  or 
15 


226  THE   LAW    OF    TAXABLE   TRANSFERS. 

to  retain  sufficient  to  pay  the  tax  rendered  such  safe- 
deposit  company  and  the  others  named  liable  to  the 
payment  of  any  tax  upon  such  assets.  Chapter  101, 
Laws  1902,  in  effect  March  6th  of  that  year,  further 
amended  former  section  228  by  making  the  failure  to 
serve  the  notice  and  to  allow  such  examination,  or  to 
retain  a  sufficient  portion  to  pay  such  tax  and  penalty, 
subject  the  safe-deposit  company  and  the  others  named 
to  the  payment  of  three  times  the  amount  of  tax  and 
penalty  upon  such  securities,  etc.,  making  the  delivery 
or  transfer. 

By  chapter  368,  Laws  1905,  in  effect  June  1st  of  that 
year,  former  section  228,  which  is  now  section  227  of 
the  Act  of  1905,  was  further  amended  by  providing 
that  no  safe-deposit  company,  and  others  named,  shall 
deliver  to  the  executors,  etc.,  of  the  estate  any  securi- 
ties, stocks,  etc.,  "  belonging  to  or  standing  in  the 
name  of  a  decedent  who  was  a  resident  or  nonresident, 
or  belonging  to,  or  standing  in  the  joint  names  of  such 
a  decedent  and  one  or  more  persons, "  or  * '  deliver  the 
same  to  the  survivors  when  held  in  the  joint  names  of 
a  decedent  and  one  or  more  persons,"  without  giving 
the  Comptroller  notice  of  the  time  and  place  of  such 
intended  delivery.  Failure  to  give  such  notice  or 
allow  the  examination  of  the  securities,  etc.,  or  to  re- 
tain a  sufficient  amount  to  pay  the  tax  and  interest 
renders  the  safe-deposit  company  and  the  others  named 
liable  to  the  payment  of  the  tax  and  interest  due  upon 
said  securities,  etc.,  "  and  in  addition  thereto  a  pen- 
alty of  one  thousand  dollars."  And  the  State  Comp- 
troller is  authorized  to  bring  an  action  to  collect  such 
tax  and  penalty  in  any  court  of  competent  jurisdiction. 


CHAPTER  XII. 

Jurisdiction  of  the  Surrogate  —  Appointment  of 
Appraisers,  Etc. 


251.  Jurisdiction     of     the     surro- 

gate. 

252.  Original  and  exclusive   juris- 

diction. 

253.  Surrogate  is  the  taxing  officer. 

254.  Determine  all  questions  relat- 

ing to  said  act. 

255.  Power  of  the  surrogate. 

256.  Can  issue  a  commission. 

257.  What    moving    papers     must 

show. 

258.  May  construe  a  will. 

259.  When     without     jurisdiction; 

incident. 

260.  Jurisdiction,    when    power    of 

appointment  is  exercised. 

261.  Ancillary    letters    can    isssue 

only  to,  or  with  the  consent 
of,  the  foreign  executor. 


262.  Ancillary   letters   unnecessary 

in  transfer  tax  proceedings. 

263.  Jurisdiction  over  stock  in  do- 

mestic corporations. 

264.  What  irregularity  don't  effect. 

265.  Distribution    does    not    affect 

the  jurisdiction. 
206.  Corresponding  sections  of  for- 
mer   acts    relating    to    the 
jurisdiction  of  the  surrogate. 

267.  Appointment      of      appraiser, 

stenographer,  etc. 

268.  The  general  subject. 

269.  Chapter    658,    Laws    1900,    is 

constitutional. 

270.  County   treasurers    to    act    as 

appraiser  in  certain  coun- 
ties; Chapter  173,  Laws 
1901,  is  constitutional. 


251.  Jurisdiction  of  the  Surrogate. 

[§  228,  Tax  Law.]  The  surrogate's  court  of  every  county 
of  the  state1  having  jurisdiction  to  grant  letters  testamentary 
or  of  administration  upon  the  estate  of  a  decedent  whose 
property  is  chargeable  with  any  tax  under  this  article,  or  to 


[Former  section  229  related  to  jurisdiction  of  the  surrogate.] 
1.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  jear. —  Section 
15  provided  that  the  Surrogate's  Court  in  which  the  real  property  of 
a  nonresident  decedent  was  situate  or  in  the  county  of  which  the 
decedent  was  a  resident  at  the  time  of  his  death  should  have  jurisdic- 
tion to  determine  all  questions  relating  to  the  tax  under  said  act. 
Section  16  of  said  act  also  referred  to  the  jurisdiction  of  the  surrogate 
where  it  shall  appear  that  any  tax  accruing  under  said  act  had  not  been 
paid. 

[227] 


2"28  THE   LAW    OF   TAXABLE   TRANSFERS. 

appoint  a  trustee  of  such  estate  or  any  part  thereof,  or  to 
give  ancillary  letters  thereon,  shall  have  jurisdiction  to  hear 
and  determine  all  questions  arising  under  the  provisions  of 
this  article,  and  to  do  any  act  in  relation  thereto  authorized 
by  law  to  be  done  by  a  surrogate  in  other  matters  or  proceed- 
ings coming  within  his  jurisdiction ;  and  if  two  or  more  sur- 
rogates' courts  shall  be  entitled  to  exercise  any  such  juris- 
diction, the  surrogate  first  acquiring  jurisdiction  hereunder 
shall  retain  the  same  to  the  exclusion  of  every  other  sur- 
rogate.2 Every  petition  for  ancillary  letters  testamentary  or 
ancillary  letters  of  administration  made  in  pursuance  of  the 
provisions  of  article  seven,  title  three,  chapter  eighteen  of  the 
cade  of  civil  procedure  shall  set  forth  the  name  of  the  state 
comptroller3  as  a  person  to  be  cited  as  therein  prescribed, 
and  a  true  and  correct  statement  of  all  the  decedent's  prop- 
erty in  this  state  and  the  value  thereof;  and  upon  the  pre- 
sentation thereof  the  surrogate  shall  issue  a  citation  directed 
to  the  state  comptroller ;  and  upon  the  return  of  the  citation 
the  surrogate  shall  determine  the  amount  of  the  tax  which 
may  be  or  become  due  under  the  provisions  of  this  article  and 
nis  decree  awarding  the  letters  may  contain  any  provision  for 
the  payment  of  such  tax  or  the  giving  of  security  therefor 
which  might  be  made  by  such  surrogate  if  the  state  comp- 
troller were  a  creditor  of  the  decedent.4 

2.  Chap.  399,  Laws  1892  — in  effect  May  1  of  that  year.— Contains 
provision  that  the  Surrogate's  Court  having  jurisdiction  to  grant  letters 
testamentary  or  of  administration  upon  the  estate  of  decedent  whose 
property  is  chargeable  with  any  transfer  tax,  *  *  *  or  to  give 
ancillary  letters  thereon,  shall  have  jurisdiction  to  hear  and  determine 
nil  questions  arising  under  the  provisions  of  this  article.  This  provision 
became  a  part  of  section  229  of  the  Act  of  1896. 

3.  Chap.  173,  Laws  1901  — in  effect  April  1  of  that  year.— Pro- 
vided that  the  State  Comptroller  must  be  cited  upon  the  application 
for  ancillary  letters  in  all  counties  where  the  office  of  appraiser  is 
♦alaried. 

'  Chap.  368,  Laws  1905  — in  effect  June  1  of  that  year.— Provides 
thai  the  State  Comptroller  shall  be  cited  upon  every  application  for 
•  ncillarv  letters. 

4.  Chap.  399,  Laws  1892  — in  effect  May  1  of  that  year.— Section  10 
«£  the  Act  of  1892  contained  a  provision  substantially  the  same  as  the 
foregoing  in  reference  to  providing  for  the  payment  of  tax  or  giving 
security  therefor. 


JURISDICTION    OF    THE    SURROGATE.  22£ 

252.  Original  and  Exclusive  Jurisdiction. 

In  construing  the  provisions  of  sections  13  and  15 
of  the  Act  of  1885  the  court  said :  "  When  we  read  all 
the  provisions  of  this  act,  it  is  perfectly  apparent  thafe 
a  special  system  of  taxation  was  created  for  the  benefit 
of  the  State  with  all  the  necessary  machinery  for  its 
working;  the  control  with  respect  to  which  was  vested 
in  the  Surrogate's  Court  with  jurisdiction  exclusive 
in  its  nature."     Matter  of  Wolfe,  137  N.  Y.  205-211. 

The  Supreme  Court  has  no  jurisdiction 
in  the   absence   of   statutory   authority  to- 

usurp  the  functions  of  the  surrogate  as  a  taxing  officer 
under  the  Taxable  Transfer  Act.  Weston  v.  Goodrich, 
86  Hun,  194-200,  33  N.  Y.  S.  382. 

253.  Surrogate  is  the  Taxing  Officer. 

The  surrogate  is  first  made  a  taxing  officer,  who, 
upon  the  report  of  his  appraiser,  enters  an  order  fixing 
the  tax  "  as  of  course,"  from  which  an  appeal  lies  io 
the  surrogate  sitting  as  a  judge,  when  for  the  fiiist 
time  the  proceedings  take  on  a  judicial  character. 
Weston  v.  Goodrich,  86  Hun,  194-199,  33  N.  Y.  S.  382. 

254.  Determine  all  Questions  Relating  to  Said  Act. 

The  Surrogate's  Court  in  the  county  in  which  a  dece- 
dent was  a  resident  at  the  time  of  his  death  has  juris 
diction  to  hear  and  determine  all  questions  in  relation 
to  taxation  under  said  act  (Act  of  1885,  as  amended  by 
chap.  713,  L.  1887),  and  also  has  power  to  decide  even- 
question  that  may  arise  in  a  proceeding  under  the  act 
which  may  be  necessary  to  fully  discharge  the  duties 
imposed.     Matter  of  Vllman,  137  N.  Y.  403. 


230  THE   LAW    OF    TAXABLE    TRANSFERS. 

255.  Power  of  the  Surrogate. 

If  the  executor  of  a  nonresident  decedent  denies  that 
the  decedent  was  a  resident  of  the  State  of  New  York, 
the  surrogate  has  no  power,  until  the  question  of  resi- 
dence has  been  determined,  to  require  the  executor  to 
disclose  what  stocks  of  foreign  corporations  were 
owned  by  the  decedent  at  the  time  of  his  death.  Matter 
of  Bishop,  82  App.  Div.  112,  81  N.  Y.  S.  474.* 

256.  Can  Issue  a  Commission. 

The  surrogate  has  power  to  issue  a  commission  to 
take  the  testimony  of  a  nonresident  witness  for  use 
before  an  appraiser  in  transfer  tax  proceedings  upon 
the  estate  of  a  nonresident  decedent.  Matter  of  Wal- 
lace, 71  App.  Div.  284,  75  N.  Y.  S.  838. 

257.  What  Moving  Papers  Must  Show. 

The  moving  papers  upon  an  application  for  a  com- 
mission must  show  that  the  property  which  is  alleged 
to  be  subject  to  the  tax  is  within  the  jurisdiction  of  the 
court.     Matter  of  Wallace  {supra). 

258.  May  Construe  Will. 

The  surrogate  is  clothed  with  power  and  it  is  his 
duty  to  decide  whether  any  property  of  the  decedent 
has  passed  to  another  under  the  will,  or  the  intestate 
laws,   and  may  determine   whether   the   dispositions 

'.This  case  will  doubtless  be  taken  to  the  Court  of  Appeals  for  the 
purpose  of  determining  the  question  as  to  whether  the  appraiser  under 
the  provisions  of  the  Transfer  Tax  Law  has  not  jurisdiction  to  deter- 
mine the  place  of  the  decedent's  domicile,  as  an  incident  to  his  power 
to  assess  only  those  assets  which  are  taxable  under  the  law. 


JURISDICTION    OF    THE    SURROGATE.  231 

made  by  a  will  are  void  and,  if  so,  the  ultimate  devolu- 
tion of  the  property  of  the  decedent.  Mattel'  of  Till- 
man, 137  N.  Y.  403.  Citing  In  re  McPherson,  104  N.  Y. 
306;  In  re  Enston,  113  N.  Y.  174;  In  re  Sherwell,  125 
N.  Y.  379 ;  In  re  Roumaine,  127  N.  Y.  80;  In  re  Stewart, 
131  N.  Y.  274;  In  re  Wolfe,  137  N.  Y.  205;  In  re  Prime, 
13G  N.  Y.  347;  In  re  Sivift,  137  N.  Y.  77.  To  the  same 
effect  see  Matter  of  Peters,  69  App.  Div.  465,  74  N.  Y.  S. 
1028. 

259.  When  Without  Jurisdiction  —  Incident. 

The  surrogate  is  without  jurisdiction  to  levy  a  tax 
upon  personal  property  of  a  nonresident  who  dies  pos- 
sessed of  only  personal  property  in  this  State  prior  to 
May  1,  1892,  although  such  property  was  not  removed 
from  this  State  until  after  that  date.  Matter  of  Pettit, 
65  App.  Div.  30-33,  72  N.  Y.  S.  469. 

260.  Jurisdiction  When  Power  of  Appointment  is  Exercised. 

The  surrogate  of  the  county  in  which  the  donee  of 
the  power  of  appointment  resided  at  the  time  of  her 
death,  and  in  which  her  will  was  admitted  to  probate, 
has  jurisdiction  under  section  229  (now  section  228) 
of  the  Tax  Law  to  determine  whether  the  transfer  is 
taxable.  Matter  of  Seaver,  63  App.  Div.  283,  71  N.  Y. 
S.  544.  This  decision  was  rendered  under  chapter 
284,  Laws  1897,  amending  section  220  by  taxing  trans- 
fers upon  the  execution  of  a  power,  as  if  the  interest 
passed  from  the  donee  upon  the  exercise  of  the  power 
by  will. 


232        THE  LAW  OF  TAXABLE  TRANSFERS. 

261.  Ancillary  Letters  can  Issue  Only  to  or  With  the  Consent 

of  the  Foreign  Executor. 

The  Surrogate's  Court  has  no  power  to  issue  letters 
of  administration  with  the  will  annexed  upon  the  estate 
of  a  decedent  whose  will  has  been  admitted  to  probate 
in  the  foreign  jurisdiction  of  another  State.  Juris- 
diction with  respect  to  such  wills  is  limited  to  the 
issue  of  ancillary  letters  testamentary,  or  ancillary 
letters  of  administration  with  the  will  annexed,  and 
under  section  2697  of  the  Code  of  Civil  Procedure  it 
cannot  issue  even  ancillary  letters  to  a  person  other 
than  the  foreign  executor  or  administrator,  unless  such 
person  files  with  his  petition  the  consent  of  the  foreign 
executor  or  administrator.  Baldwin  v.  Rice,  100  App. 
Div.  241. 

262.  Ancillary  Letters  Unnecessary  in  Transfer  Tax  Proceed- 

ings. 

Where  neither  letters  testamentary  nor  ancillary  let- 
ters were  applied  for,  that  fact  is  unnecessary  to  confer 
jurisdiction  upon  the  surrogate  to  impose  a  tax  upon 
the  property  of  a  nonresident  decedent.  Matter  of 
Fitch,  160  N.  Y.  87-91. 

263.  Jurisdiction  Over  Stock  in  Domestic  Corporations. 

It  seems  that  the  Transfer  Tax  Act  and  the  section 
of  the  Code  of  Civil  Procedure  providing  for  the  grant- 
ing of  letters  upon  a  decedent's  estate  should  be  read 
together,  as  if  constituting  one  enactment,  and  that 
which  is  held  to  be  property,  within  the  meaning  of 
the  portion  of  the  statute  which  imposes  a  tax  upon  its 


JURISDICTION    OF    THE    SURROGATE.  233 

transfer,  is  also  property  for  the  purpose  of  conferring 
upon  the  Surrogate's  Court  jurisdiction  to  impose  the 
tax.  Therefore  the  surrogate  of  the  county  in  which 
a  domestic  corporation  operates,  has  jurisdiction  to 
assess  the  transfer  tax  upon  stock  of  such  domestic 
corporations  owned  by  a  nonresident  at  the  time  of  his 
death.  Matter  of  Fitch,  160  N.  Y.  87,  affg.  same  case, 
39  App.  Div.  609,  57  N.  Y.  S.  786,  and  26  Misc.  Rep. 
353,  57  N.  Y.  S.  212. 

264.  What  Irregularity  Don't  Effect. 

The  surrogate  who  first  issues  ancillary  letters  upon 
the  estate  of  a  nonresident,  who  leaves  property  in  more 
than  one  county  in  this  State,  acquires  exclusive  juris- 
diction to  appoint  an  appraiser  for  the  purpose  of 
transfer  tax  proceedings,  although  the  proceedings  be- 
fore that  surrogate  were  irregular,  in  that  the  ancillary 
letters  were  acquired  without  citing  the  county  treas- 
urer as  required  by  law.  Matter  of  Hathaway,  27  Misc. 
Rep.  474,  59  N.  Y.  S.  166. 

265.  Distribution    Does  not  Affect  the  Jurisdiction. 
Where  foreign  executors  have  made  distribution  of 

the  property  within  this  State  and  been  discharged  by 
the  court  of  the  decedent's  domicile,  the  surrogate  of 
the  county  in  this  State  where  such  personal  property 
was  situated  at  the  time  of  the  owner's  death  has  juris- 
diction to  fix  the  tax.  Matter  of  Hubbard,  21  Misc. 
Rep.  566,  48  N.  Y.  S.  869 ;  Matter  of  Fitch,  26  Misc.  Rep. 
353,  57  N.  Y.  S.  212;  Matter  of  Crerar,  31  Misc.  Rep. 
481,  65  N.  Y.  S.  573. 


234  THE    LAW    OF   TAXABLE    TRANSFERS. 

266.  Corresponding  Sections  of  Former  Acts  Relating  to  the 
Jurisdiction  of  the  Surrogate. 

Section  15  of  the  Act  of  1885  stated  that  the  Surro- 
gate's Court  of  the  county  in  which  the  real  property 
of  a  decedent  who  was  not  a  resident  was  situate,  or 
in  the  county  of  which  the  decedent  was  a  resident  at 
the  time  of  his  death,  should  have  jurisdiction  to  hear 
all  questions  in  relation  to  the  tax  arising  under  that 
act.  By  the  amendment  to  section  1  of  the  Act  of 
1885  by  chapter  713,  Laws  1887,  taxing  the  property  of 
nonresidents  in  this  State,  the  courts  held  that  section 
15  limited  the  jurisdiction  of  the  Surrogate's  Court, 
in  the  case  of  nonresident  decedents,  to  the  assessment 
of  tax  in  such  cases  only  when  the  nonresident  owned 
real  estate  in  this  State.  Matter  of  Embury,  19  App. 
Div.  214;  affd.,  154  N.  Y.  746.  Section  10  of  the  Act 
of  1892,  revised  from  section  15  of  the  Act  of  1885,  be- 
came section  229  of  the  Act  of  1896,  which  was  amended 
by  chapter  173,  Laws  1901,  in  effect  April  1st  of  that 
year,  by  providing  that  in  the  petition  for  ancillary 
letters  the  State  Comptroller  must  be  cited  in  counties 
where  the  office  of  the  appraiser  is  salaried,  and  in  the 
other  counties  the  county  treasurer.  Section  229  of 
the  Act  of  1896,  as  amended,  became  section  228  of 
chapter  368  of  the  Laws  of  1905,  and  was  amended  so 
that,  upon  the  application  for  ancillary  letters  in  any 
county,  the  citation  shall  be  directed  to  the  State 
Comptroller. 

267.  Appointment  of  Appraisers,  Stenographers,  Etc. 

[§  229,  Tax  Law.]      The  state  comptroller  shall  appoint 
and  may  at  pleasure  remove  not  to  exceed  six  persons  in  the 


APPOINTMENT   OF    APPRAISERS,    STENOGRAPHERS,    ETC.    235 

count j  of  New  York;1  two  persons  in  the  county  of  Kings,2 
and'  one  person  in  the  counties  of  Albany,  Dutchess,  Erie,3 
Monroe,  Oneida,  Onondaga,  Orange,  Queens,  Rensselaer, 
Richmond,  Suffolk  and  Westchester,4  to  act  as  appraisers 
therein.  The  appraisers  so  appointed  shall  receive  an  annual 
salary  to  be  fixed  by  the  state  comptroller,  together  with  their 
actual  and  necessary  traveling  expenses  and  witness  fees,  as 
hereinafter  provided,  payable  monthly  by  the  state  comp- 
troller out  of  any  funds  in  his  hands  or  custody  on  account  of 
transfer  tax.  The  salaries  of  each  of  the  appraisers  so  ap- 
pointed shall  not  exceed  the  following  amounts:  In  New 
York  county,  four  thousand  dollars ;  in  Kings  county,  three 
thousand  dollars ;  in  Erie  county,  three  thousand  dollars ;  in 
Westchester  and  Albany  counties,  twenty-five  hundred  dol- 
lars; in  Queens,  Monroe  and  Onondaga  counties,  one  thou- 
sand five  hundred  dollars ;  in  Dutchess,  Oneida,  Orange, 
Rensselaer  and  Suffolk  counties,  one  thousand  dollars,  and  in 
Richmond  county,  five  hundred  dollars.  Each  of  the  said 
appraisers  shall  file  with  the  state  comptroller  his  oath  of 
office  and  his  official  bond  in  the  penal  sum  of  not  less  than 
one  thousand  dollars,  in  the  discretion  of  the  state  comp- 
troller, conditioned  for  the  faithful  performance  of  his  duties 
as  such  appraiser,  which  bond  shall  be  approved  by  the  at- 
torney-general and  the  state  comptroller.  The  state  comp- 
troller shall  retain  out  of  any  funds  in  his  hands  on  account, 
of  said  tax  the  following  amounts :  First.  A  sum  sufficient 
to  provide  the  appraisers  of  New  York  county  with  five 

[Former  section  230  in  part  related  to  the  appointment  of  appraisers, 
stenographers,  etc.] 

1-3.  Chap.  658,  Laws  1900  — in  effect  April  25  of  that  year. —  Au- 
thorized the  State  Comptroller  to  appoint  and  at  pleasure  remove  five 
persons  in  the  county  of  New  York ;  two  persons  in  the  county  of 
Kings,  and  one  person  in  the  county  of  Erie,  to  act  as  appraisers  therein. 

By  Chap.  .308,  Laws  1905  — in  effect  June  1  of  that  year.— The 
numher  of  appraisers  in  New  York  county  was  changed  from  five  to 
"  six." 

4.  Chap.  173,  Lawa  1901  — in  effect  April  1  of  that  year.—  The 
State  Comptroller  was  authorized  to  appoint  appraisers  in  the  eleven 
other  counties  hereinbefore  named.  The  appraisers  in  the  other  coun- 
ties were  not  to  be  appointed,  however,  until  January  1,  1902,  and  until 
such  time  said  counties  were  deemed  counties  in  which  the  office  of 
apprai  •     nol  salaried. 


236        THE  LAW  OF  TAXABLE  TRANSFERS. 

stenographers,5  of  Kings  county  with  two  stenographers,0 
and  of  Erie  county  with  one  clerk,7  appointed  by  the  state 
comptroller,  whose  salary  shall  not  exceed  fifteen  hundred 
dollars  a  year  each.  Second.  A  sum  to  be  used  in  defraying 
the  expenses  for  office  rent,  stationery,  postage,  process  serv- 
ing, et  cetera,  necessarily  incurred  in  the  appraisal  of  estates, 
not  exceeding  seven  thousand  five  hundred  dollars  a  year  in 
New  York  county,  and  one  thousand  five  hundred  dollars  a 
year  in  Kings  county. 

268.  The  General  Subject. 

Section  13  of  the  Act  of  1885  gave  the  surrogates  in 
each  county  the  right  to  designate  some  competent 
person  to  act  as  appraiser,  upon  the  application  of  any 
interested  party  or  upon  his  own  motion.  By  the  re- 
vision of  1892,  section  11  of  that  act  provided  for  the 
surrogate  to  designate  an  appraiser  upon  the  applica- 
tion of  any  interested  party,  including  the  county  treas- 
urer or  the  comptroller  of  New  York  city,  or  upon  his 
own  motion,  and  this  section  also  contained  other  pro- 
visions which,  however,  are  not  relative  to  the  appoint- 
ment of  appraisers.  Section  14-  of  the  Act  of  1892 
provided  for  certain  assistants  for  the  surrogate  of 
New  York  county. 

Section  11  of  the  Act  of  1892  became  section  230  of 
the  Act  of  1896,  to  which  was  added  from  time  to  time 

5.  Chap.  658,  Laws  1900  —  in  effect  April  25  of  that  year. —  Provided 
for  two  stenographers  for  the  appraiser  in  New  York  county. 

By  Chap.  496,  Laws  1902  — in  effect  April  30  of  that  year.— Pro- 
vision was  made  for  "  five  "  stenographers  in  New  York  county. 

6.  Chap.  658,  Laws  1900  —  in  effect  April  25  of  that  year.— Pro- 
vided for  one  stenographer  for  the  appraisers  in  Kings  county. 

By  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  Pro- 
vision was  made  for  two  stenographers  in  Kings  county. 

7.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  The  ap- 
praiser of  Erie  county  was  allowed  one  clerk. 


APPOINTMENT   OF    APPRAISERS,   STENOGRAPHERS,    ETC.    237 

several  amendments,  but  only  such  as  are  relative  to 
the  appointment  of  appraisers  and  stenographers  are 
referred  to  at  this  time,  reference  being  made  to  the 
other  provisions  under  sections  230,  231,  232,  following. 

By  chapter  284,  Laws  1897,  amending  section  230, 
and  in  effect  April  16th  of  that  year,  the  State  Comp- 
troller was  made  an  interested  party,  who  could  re- 
quire the  appointment  of  an  appraiser.  Chapter  658, 
Laws  1900,  amending  section  230,  and  in  effect  April 
25th  of  that  year,  provided  that  the  State  Comptroller 
shall  appoint  and  may  at  pleasure  remove  five  persons 
in  New  York  county;  two  persons  in  Kings,  and  one 
person  in  Erie  county  to  act  as  appraisers  therein,  the 
amendment  providing  for  their  salaries,  etc.;  this 
amendment  also  provided  for  two  stenographers  in 
New  York  county  and  one  stenographer  in  Kings 
county  and  their  salaries.  Section  230  was  further 
amended  by  chapter  173,  Laws  1901,  in  effect  April 
1st  of  that  year,  by  providing  for  the  appointment  of 
one  person  to  act  as  appraiser  in  the  counties  of  Al- 
bany, Dutchess,  Monroe,  Oneida,  Onondaga,  Orange, 
Queens,  Rensselaer,  Richmond,  Suffolk,  and  Westches- 
ter, and  fixing  the  salaries  of  such  appraisers.  This 
amendment  provided  further  that  in  each  county  in 
which  the  office  of  the  appraiser  was  not  salaried  the 
county  treasurer  should  act  as  appraiser. 

By  chapter  368,  Laws  1905,  in  effect  June  1st,  the 
provisions  of  former  section  230,  but  only  those  relat- 
ing solely  to  the  appointment  of  appraisers,  stenog- 
raphers, etc.,  was  amended  and  re-enacted  under  sec- 


238  THE   LAW    OF    TAXABLE    TRANSFERS. 

tion  229  of  the  Act  of  1905  as  above,  the  law  now 
providing  for  six  appraisers  in  New  York  county,  and 
Kings  county  is  allowed  two  stenographers  instead  of 
one,  as  formerly,  and  the  appraiser  of  Erie  county  is 
allowed  one  clerk. 

Reference  to  the  other  provisions  of  former  section 
230  will  be  found  in  sections  230,  231,  and  232,  post. 

The  effect  of  chapter  658,  Laws  1900,  amending  sec- 
tion 230,  and  directing  the  State  Comptroller  to  ap- 
point appraisers  in  certain  counties,  was  to  deprive 
the  surrogates  of  such  counties  of  the  right  to  select 
the  appraiser,  and  this  is  true  although  the  tax  is 
assessable  under  chapter  399,  Laws  1892.  Matter  of 
Sondheim,  32  Misc.  Rep.  296,  66  N.  Y.  S.  726;  affd.,  69 
App.  Div.  5,  74  N.  Y.  S.  510. 

269.  Chapter  658,   Laws  1900,   is  Constitutional. 

Chapter  658,  Laws  1900,  which  amends  article  10  of 
the  Tax  Law  by  providing,  among  other  things,  for  the 
appointment  by  the  State  Comptroller  of  transfer  tax 
appraisers  in  the  counties  of  New  York,  Kings,  and 
Erie,  is  not  a  local  act,  and  consequently  does  not  vio- 
late the  Constitution,  which  provides  that ' '  no  private 
or  local  bill  which  may  be  passed  by  the  Legislature 
shall  embrace  more  than  one  subject  and  that  shall  be 
expressed  in  the  title."  Matter  of  Wallace,  71  App. 
Div.  284,  75  N.  Y.  S.  838. 

270.  County  Treasurers  to  Act  as  Appraiser  in  Certain  Coun- 

ties—  Chapter  173,   Laws  1901,    is  Constitutional. 

The  Act  of  1901,  providing  for  the  appointment  of 
salaried  appraisers  in  certain  counties,  also  provided 


APPOINTMENT   OF    APPRAISERS,   STENOGRAPHERS,   ETC.    239 

that  in  all  other  counties  of  the  State  the  surrogate 
shall  direct  the  county  treasurer  to  make  the  appraise- 
ment. It  further  provided  that  the  act  should  take 
effect  April  1,  1901,  except  that  salaried  appraisers  in 
the  counties  of  Albany,  Queens,  Suffolk,  Westchester, 
Dutchess,  Monroe,  Oneida,  Onondaga,  Orange,  Rich- 
mond, and  Rensselaer  shall  not  be  appointed  before 
January  1, 1902,  and  until  such  time  such  counties  shall 
be  deemed  counties  in  which  the  office  of  appraiser  is 
not  salaried  under  the  provisions  of  this  act.  This 
necessitated  the  surrogates  in  the  counties  named  to 
refer  all  appraisals  in  their  counties  between  April  1 
and  December  31,  1901,  to  the  county  treasurers,  the 
same  as  in  the  other  counties  of  the  State.  The  sur- 
rogate of  Westchester  county,  in  the  Matter  of  Fuller, 
34  Misc.  Rep.  750,  70  N.  Y.  S.  1050,  held  that  the  county 
treasurer  could  not  act  as  appraiser,  as  the  act  was 
unconstitutional.  The  Appellate  Division  reversed  the 
surrogate,  holding  that  the  county  treasurer  may  law- 
fully fix  the  market  value  of  property  subject  to  the 
transfer  tax,  and  that  the  act  authorizing  him  to  do  so 
was  constitutional.  Matter  of  Fuller,  62  App.  Div.  428, 
71  N.  Y.  S.  40. 


CHAPTER  XIII. 


Proceedings  by  Appraisers. 


294. 


271.  Proceedings  by  appraiser. 

272.  Character  of  the  law. 

273.  Construction  of  the  act. 

274.  When     appraiser     to    be     ap- 

pointed. 

275.  Who    can    make    the    applica- 

tion. 

276.  Application    of    State    Comp- 

troller on  information  and 
belief  as  to  taxable  prop- 
erty. 

277.  State  Comptroller's  right  to  an 

appraisal. 

278.  Where  property  is  in  several 

counties. 

279.  Appraisal    of    interest;    when 

postponed. 

280.  What  statute  controls  proceed- 

ings. 

281.  Notice  of  appraisal. 

282.  Notice;  held  insufficient  under 

Act  of  1887. 

283.  People  —  interested  party  un- 

der act  of  1885. 

284.  Hearings  before  appraiser. 

285.  Power  of  the  appraiser. 

286.  May  report  as  to  date  of  de- 

cedent's death. 

287.  Evidence  as  to  declarations  of 

testator. 

288.  Competency  of  witness. 

289.  Testimony  of  legatee. 

290.  Nonresident    executor;     when 

not  obliged  to  testify. 

291.  Basis  of  value. 

292.  Increase  of  property;    not  to 

be  appraised. 

293.  Appraisal  of  residuary  estate 

where  part  thereof  is  sub- 
ject to  appointment. 

[240] 


295. 


296. 
297. 
298. 
299. 
300. 
301. 

302. 

303. 

304. 

305. 

306. 

307. 
308. 
309. 

310. 
311. 
312. 

313. 


314. 
315. 
316. 


Effect  of  failure  to  tax  known 
property. 

When  omission  to  tax  life  es- 
tate amounts  to  an  express 
reservation  thereof. 

Burden  of  proof. 

Worthless   account ;    excluded. 

Report  of  appraiser. 

What  report  should  show. 

What  report  should  contain. 

The  American  experience 
tables  of  mortality. 

Surrogate  may  return  report 
to  appraiser. 

Should  vacate  order  when  re- 
port defective. 

When  second  appraisal  cannot 
be  had. 

Second  appraisal ;  cannot  in- 
crease value  of  assets. 

Id. :  nor  decrease  deductions 
for  debts,  etc. 

Appraisal  not  regular;   when. 

When  report  insufficient. 

Surrogate  may  order  further 
appraisal. 

New  proceeding. 

Former  proceeding. 

Appraisal  of  bonds;  stocks 
and  securities. 

Stocks  of  domestic  corpora- 
tions are  appraised  at  their 
market  value  regardless  of 
where  their  capital  is  em- 
ployed. 

Unlisted  stocks;  appraisal  of. 

Joint-stock   associations. 

Joint-stock  associations  and 
corporations;  difference  be- 
tween. 


PROCEEDINGS   BY    APPRAISERS. 


241 


317.  Taxable  value;  where  there  is    322. 

no  market  value. 

318.  Appraisal  of  inactive  stock.  323. 

319.  The  test  of  value. 

320.  Notes  directed  to  be  canceled;    324. 

appraisal  of. 

321.  Notes  or  claims  in  litigation. 


Disputed  claim ;  not  appraised 
at  face  value. 

Appraiser  taking  fee  or  re- 
ward. 

Corresponding  section  of  for- 
mer acts  relating  to  pro- 
ceedings by  appraisers. 


271.  Proceedings  by  Appraiser. 

[§  230,  Tax  Law.]  In  each  county  in  which  the  office 
of  appraiser  is  not  salaried  the  county  treasurer  shall  act  as 
appraiser.1  The  surrogate,  either  upon  his  own  motion,  or 
upon  the  application  of  any  interested  person,  including  the 
state  comptroller,2  shall  by  order  direct  the  person  or  one  of 
the  persons  appointed  pursuant  to  section  two  hundred  and 
twenty-nine  of  this  article  in  counties  in  which  the  office  of 
appraiser  is  salaried,  and  in  other  counties,  the  county  treas- 
urer, to  fix  the  fair  market  value  of  property  of  persons 
whose  estates  shall  be  subject  to  the  payment  of  any  tax 
imposed  by  this  article.3 

Every  such  appraiser  shall  forthwith  give  notice  by  mail 
to  all  persons  known  to  have  a  claim  or  interest  in  the  prop- 
erty to  be  appraised,  including  the  state  comptroller,  and  to 
such  persons  as  the  surrogate  may  by  order  direct,  of  the 
time  and  place  when  he  will  appraise  such  property.  He 
shall  at  such  time  and  place,  appraise  the  same  at  its  fair 

1.  Chap.  173,  Laws  1901  —  in  effect  April  1  of  that  year. —  Section 
230  first  provided  for  the  county  treasurer  to  act  as  appraiser  in  the 
counties  where  the  appraisers  are  not  salaried. 

2.  Chap.  284,  Laws  1897  —  in  effect  April  16  of  that  year. —  Section 
230  first  made  State  Comptroller  an  interested  party  to  institute  pro- 
ceedings. 

3.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year. —  Section 
13  provided  that  in  order  to  find  the  value  of  the  property  subject  to 
tax,  the  surrogate  on  the  application  of  any  interested  party  or  upon 
his  own  motion  shall  appoint  some  competent  person  to  act  as  ap- 
praiser, etc. 

By  Chap.  399,  Laws  1892  —  in  effect  May  1  of  that  year. —  Section  11 
included  the  county  treasurer  or  the  comptroller  of  the  city  of  New 
York  as  interested  parties  who  could  apply  for  the  appointment  of 
an  appraiser,  and  this  provision  was  continued  in  chapter  908,  Laws 
1896.  In  1897,  county  treasurer  and  the  city  comptroller  were  omitted 
as  interested  parties  and  the  State  Comptroller  substituted  in  their 
place. 

16 


242  THE    LAW    OF    TAXABLE    TRANSFERS. 

market  value  as  herein  prescribed;  and  for  that  purpose  the 
said  appraiser  is  authorized  to  issue  subpoenas4  and  to  com- 
pel the  attendance  of  witnesses  before  him  and  to  take  the 
evidence  of  such  witnesses  under  oath5  concerning  such  prop- 
erty and  the  value  thereof ;  and  he  shall  make  report  thereof 
and  of  such  value  in  writing,  to  the  said  surrogate,  together 
with  the  depositions  of  the  witnesses  examined,  and  such 
other  facts  in  relation  thereto  and  to  said  matter  as  the  sur- 
rogate may  order  or  require.6  Every  appraiser,  except  in 
the  counties  in  which  the  office  of  appraiser  is  salaried,  for 
which  provision  is  hereinbefore  made,  shall  be  paid  by  the 
state  comptroller,  and  after  the  audit  of  said  state  comptroller, 
his  actual  and  necessary  traveling  expenses  and  the  fees  paid 
such  witnesses,  which  fees  shall  be  the  same  as  those  now 
paid  to  witnesses  subpoenaed  to  attend  in  courts  of  record, 
payment  to  be  made  out  of  funds  in  the  hands  of  the  county 
treasurer  of  the  proper  county  on  account  of  the  tax  imposed 
under  the  provisions  of  this  article.  Appraisers  appointed 
under  this  article  in  proceedings  pending  at  the  time  the 
amendment  to  this  section  takes  effect  shall  complete  the  ap- 
praisals therein  and  file  their  reports  as  herein  provided,  and 
shall  be  entitled  to  the  compensation  authorized  by  law  at 
the  time  of  their  appointment,  to  be  paid  by  the  state  comp- 
troller in  counties  in  which  the  office  of  appraiser  is  salaried, 
and  in  other  counties  by  the  county  treasurer,  out  of  any 
moneys  in  his  hands  on  account  of  this  tax.7 

4.  Chap.  167,  Laws  1892  —  in  effect  March  19  of  that  year. — 
Amended  section  13  of  the  Act  of  1885,  so  that  the  appraiser  "  by  leave 
of  the  surrogate  "  can  compel  the  attendance  of  witnesses  by  subpoena. 

By  Chap.  399,  Laws  1892  —  in  effect  May  1  of  that  year. —  Section  12, 
the  appraisers  could  subpoena  witnesses  without  obtaining  leave  of 
surrogate  to  do  so. 

5.  Chap.  167,  Laws  1892  — in  effect  March  19  of  that  year.— 
Amended  section  13  of  the  Act  of  1885,  authorizing  appraisers  to  take 
the  evidence  of  witnesses  under  oath. 

6.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year. —  Section 
13  provided  that  the  appraiser  should  make  a  report  of  his  appraisal 
in  writing  to  the  surrogate,  etc. 

7.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year.— Pro- 
vided that  the  fees  of  appraiser  should  be  $3  per  day  for  every  day 
actually  and  necessarily  emploved  in  the  appraisement. 

By  Chap.  658,  Laws' 1900  —  in  effect  April  25  of  that  year.— Section 


PROCEEDINGS    BY    APPRAISERS.  24;} 

The  value  of  every  future  or  limited  estate,  income,  in- 
terest or  annuity  dependent  upon  any  life  or  lives  in  being, 
shall  be  determined  by  the  rule,  method  and  standard  of 
mortality  and  value  employed  by  the  superintendent  of  in- 
surance in  ascertaining  the  value  of  policies  of  life  insurance 
and  annuities  for  the  determination  of  liabilities  of  life  in- 
surance companies,  except  that  the  rate  of  interest  for  making 
such  computation  shall  be  five  per  centum  per  annum.8 

In  estimating  the  value  of  any  estate  or  interest  in  prop- 
erty, to  the  beneficial  enjoyment  or  possession  whereof  there 
are  persons  or  corporations  presently  entitled  thereto,  no 
allowance  shall  be  made  on  account  of  any  contingent  in- 
cumbrance thereon,  nor  on  account  of  any  contingency  upon 
the  happening  of  which  the  estate  or  property  or  some  part 
thereof  or  interest  therein  might  be  abridged,  defeated  or 
diminished ;  provided,  however,  that  in  the  event  of  such  in- 
cumbrance taking  effect  as  an  actual  burden  upon  the  interest, 
of  the  beneficiary,  or  in  the  event  of  the  abridgment,  defeat 
or  diminution  of  said  estate  or  property  or  interest  therein  as 
aforesaid,  a  return  shall  be  made  to  the  person  properly 
entitled  thereto  of  a  proportionate  amount  of  such  tax  on 
account  of  the  incumbrance  when  taking  effect,  or  so  much 
as  will  reduce  the  same  to  the  amount  which  would  have  been 
assessed  on  account  of  the  actual  duration  or  extent  o£..jthe 
estate  or  interest  enjoyed.     Such  return  of  tax  shall  be  made 

231,  appraisers  in  every  county  except  New  York,  Kings,  and  Erie,  were 
allowed  $5  per  day  and  witness  fees  paid  by  him.  Bills  for  appraisal- 
were  to  be  paid  on  the  certificate  of  the  surrogate  (subject  to  review  and 
audit  by  the  State  Comptroller)  by  the  county  treasurer  or  comptroller 
out  of  any  funds  on  account  of  such  tax. 

By  Chap.  173,  Laws  1901  —  in  effect  April  1  of  that  year. —  Former 
section  231  was  amended  in  respect  to  the  payment  of  appraiser'- 
fees,  etc.,  so  as  to  conform  to  the  amendment  that  year  providing  for 
salaried  appraisers  in  eleven  additional  counties,  etc. 

By  Chap.  3G8,  Laws  1905. —  All  bills  for  witness  fees,  etc.,  are  by 
section  230  to  be  audited  by  the  State  Comptroller. 

8.  Chap.  713,  Laws  1887  —  in  effect  June  25  of  that  year. —  Amended 
section  13  of  the  Act  of  1885,  so  as  to  have  the  value  of  future  or 
limited  estates  determined  by  the  superintendent  of  insurance,  and 
this  provision  has  been  retained  in  the  Transfer  Tax  Law  ever  sine*' 
that  time. 


244  THE   LAW    OF   TAXABLE   TRANSFERS. 

in.  the  manner  provided  by  section  two  hundred  and  twenty- 
five  of  this  article.9 

Where  any  property  shall,  after  the  passage  of  this  act,  be 
transferred  subject  to  any  charge,  estate  or  interest,  de- 
terminable by  the  death  of  any  person,  or  at  any  period  as- 
certainable only  by  reference  to  death,  the  increase  accruing 
to?  any  person  or  corporation  upon  the  extinction  or  determi- 
nation of  such  charge,  estate  or  interest,  shall  be  deemed  a 
transfer  of  property  taxable  under  the  provisions  of  this  act 
in.  the  same  manner  as  though  the  person  or  corporation 
beneficially  entitled  thereto  had  then  acquired  such  increase 
from  the  person  from  whom  the  title  to  their  respective 
estates  or  interests  is  derived.10 

When  property  is  transferred  in  trust  or  otherwise,  and 
the  rights,  interest  or  estates  of  the  transferees  are  dependent 
up*on  contingencies  or  conditions  whereby  they  may  be  wholly 
otin  part  created,  defeated,  extended  or  abridged,  a  tax  shall 
be.  imposed  upon  said  transfer  at  the  highest  rate  which,  on 
the  happening  of  any  of  the  said  contingencies  or  conditions, 
would  be  possible  under  the  provisions  of  this  article,  and 
such  tax  so  imposed  shall  be  due  and  payable  forthwith  by 
the  executors  or  trustees  out  of  the  property  transferred ; 
provided,  however,  that  on  the  happening  of  any  contingency 
wHereby  the  said  property,  or  any  part  thereof,  is  transferred 
to.  a  person  or  corporation  exempt  from  taxation  under  the 
provisions  of  this  article,  or  to  any  person  taxable  at  a  rate 
less  than  the  rate  imposed  and  paid,  such  person  or  corpora- 
tion shall  be  entitled  to  a  return  of  so  much  of  the  tax  im- 
posed and  paid  as  is  the  difference  between  the  amount  paid 
ana1  the  amount  which  said  person  or  corporation  should  pay 
urrder  the  provisions  of  this  article,11  with  interest  thereon 

9.  Chap.  284,  Laws  1897  —  in  effect  April  16  of  that  year.— First 
enacted  this  provision  and  the  same  has  been  re-enacted  without  ma- 
terial change. 

10.  Chap.  284,  Laws  1897  — in  effect  April  16  of  that  year.— First 
enacted  this  provision  and  the  same  has  been  retained  in  section  230 
without  material  change. 

11.  Chap.  76,  Laws  1899  —  in  effect  March  14  of  that  year. —  First 
enacted  this  provision,  and  the  same  has  been  continued  without  amend- 


PROCEEDINGS   BY   APPRAISERS.  23:5 

at  the  rate  of  three  per  centum12  per  annum  from  the  time  oi 
payment.  Such  return  of  overpayment  shall  be  made  in  {be 
manner  provided  by  section  two  hundred  and  twenty-five  of 
this  article. 

Estates  in  expectancy  which  are  contingent  or  defeasible 
and  in  which  proceedings  for  the  determination  of  the  fax 
have  not  been  taken  or  where  the  taxation  thereof  has  been 
held  in  abeyance,  shall  be  appraised  at  their  full,  undimin- 
ished value  when  the  persons  entitled  thereto  shall  come  in'to 
the  beneficial  enjoyment  or  possession  thereof,  without  dim- 
inution for  or  on  account  of  any  valuation  theretofore  made 
of  the  particular  estates  for  purposes  of  taxation,  upon  which 
said  estates  in  expectancy  may  have  been  limited.13 

Where  an  estate  for  life  or  for  years  can  be  divested  by  ihe 
act  or  omission  of  the  legatee  or  devisee  it  shall  be  taxed*",  as 
if  there  were  no  possibility  of  such  divesting.14 

The  report  of  the  appraiser  shall  be  made  in  duplicate,  Sue 
of  which  duplicates  shall  be  filed  in  the  office  of  the  surrogate 
and  the  other  in  the  office  of  the  state  comptroller.15 

ment.  except  that  this  act  provided  payment  of  legal  interest  on  all 
refund  of  excess  taxes. 

1Z.  Chap.  496,  Laws  1902  —  in  effect  April  30  of  that  year. —  Section 
230  provided  that  the  rate  of  interest  on  the  refunding  of  excess  i%&eH 
under  this  provision  should  be  at  the  rate  of  3  per  cent. 

13.  Chap.  284,  Laws  1897  —  in  effect  April  16  of  that  year.—  First 
enacted  this  provision  in  reference  to  "  estates  in  expectancy." 

By  Chap.  76,  Laws  1899  — in  effect  March  14  of  that  year.— Amend- 
ing section  230,  this  provision  was,  doubtless  inadvertently,  omitted. 

By  Chap.  173,  Laws  1901  — in  effect  April  1  of  that  year.— The  pro- 
vision was  re-enacted  and  the  words  "  and  in  which  proceedings  for  the 
determination  of  the  tax  have  not  been  taken,  or,  where  the  taxation 
thereof  has  been  held  in  abeyance,"  were  added  as  they  now  appear 
in   said   section. 

14.  Chap.  908.  Laws  1896  — in  effect  June  15  of  that  year.— First 
enacted  this  provision. 

By  Chap.  284,  Laws  1897  —  in  effect  April  16  of  that  year.—  Thw 
provision  was  omitted   from  section  230. 

By  Chap.  173,  Laws  1901  — in  effect  April  1  of  that  year.— This  pro- 
vision was  a«ain  enacted  in  section  230.  (See  Matter  of  Bloane,  1754 
N.  Y.  109.) 

15.  Chap.  483.  Laws  1885  — in  effect  June  30  of  that  year  — Section 
13  required  the  appraiser's  report  to  be  filed  in  the  surrogate's  office. 

By  Chap.  908.  Laws  1896  —  in  effect  June  15  of  that  year.— Section 
232* first  required  the  appraiser's  report  to  be  made  in  duplicate  and 
filed  aa  herein  provided. 


246  THE    LAW    OF    TAXABLE    TRANSFERS. 

272.  Character  of  the  Law. 

By  both  the  initial  Act  of  1885  and  the  subsequent 
one  of  1892,  a  special  State  tax,  not  belonging  to  the 
system  of  general  taxation,  was  created. 

In  character  it  was  so  entirely  different  from  the 
general  plan  of  taxation  that  special  agencies  were 
necessary  for  its  enforcement.  What  these  agencies 
should  be,  and  under  what  rules  and  regulations  they 
should  proceed  to  enforce  collection  of  the  tax,  the 
Legislature  alone  had  power  to  determine.  Weston  v. 
Goodrich,  86  Hun,  194-199,  33  N.  Y.  S.  382. 

273.  Construction  of  the  Act. 

The  Tax  Law  should  be  construed  strictly  in  favor  of 
the  citizen  and  against  the  State.  Matter  of  Enston, 
113  N.  Y.  174;  Matter  of  Vassar,  127  N.  Y.  12;  Matter 
of  Stewart,  131  N.  Y.  274,  282;  Matter  of  Sivift,  137 
N.  Y.  77,  86;  Matter  of  Fayerweather,  143  N.  Y.  114; 
Matter  of  Harbeck,  161  N.  Y.  211,  217. 

274.  When  Appraiser  to  be  Appointed. 

Under  the  Act  of  1885  it  was  held  that  appraisers 
should  only  be  appointed  in  taxable  estates.  Matter 
of  James,  5  Dem.  30.  But  since  the  Act  of  1892  the 
practice  has  been  to  institute  proceedings  in  all  estates 
where  apparently  there  is  a  tax  due,  and  at  as  early  a 
date  as  possible  after  letters  are  issued. 

The  Court  of  Appeals,  in  the  Matter  of  Westum,  152 
N.  Y.  100,  said:  "  We  think  the  jurisdiction  of  the 
surrogate  to  appoint  an  appraiser  is  one  that  may  be 
exercised  with  or  without  a  petition,  and  of  his  own 


PROCEEDINGS    BY    APPRAISERS.  247 

motion,  whenever  in  the  sound  exercise  of  his  discre- 
tion he  deems  it  proper  to  do  so,  in  a  case  in  which  he 
is  officially  cognizant  of  the  fact  that  property  had 
been  transferred  in  the  manner  mentioned  in  section 
220  of  the  act." 

275.  Who  Can  Make  the  Application. 

The  application  for  an  order  appointing  an  appraiser 
in  transfer  tax  proceedings  is  generally  made  by  the 
executor  or  administrator,  but  the  statute  provides 
that  the  surrogate  may  appoint  an  appraiser  either 
upon  his  own  motion,  or  upon  the  petition  of  any  inter- 
ested party,  which  includes  the  State  Comptroller. 
Matter  of  O'Donohue,  44  App.  Div.  186,  59  N.  Y.  S. 
1087,  60  N.  Y.  S.  690. 

276.  Application  of  State  Comptroller  on  Information  and  Be- 

lief as  to  Taxable  Property. 

A  petition  by  the  State  Comptroller,  stating  on  in- 
formation and  belief  that  a  will  has  been  duly  admitted 
to  probate,  and  that  the  property  of  the  decedent  pass- 
ing by  will,  or  some  portion  thereof  or  interest  therein, 
is  subject  to  the  payment  of  a  transfer  tax,  is  sufficient 
to  empower  the  surrogate  to  appoint  an  appraiser  with- 
out proof  showing  what  specific  property  of  the  dece- 
dent was  taxable.  Matter  of  O'Donohue,  44  App.  Div. 
186,  60  N.  Y.  S.  690,  affg.  28  Misc.  Rep.  607,  59  N.  Y.  S. 
1087.  The  same  rule  would  doubtless  apply  where 
the  decedent  died  intestate,  and  the  application  was 
made  by  the  State  Comptroller  upon  information  and 
belief  as  to  the  facts  stated. 


248        THE  LAW  OF  TAXABLE  TRANSFERS. 

277.  State  Comptroller's  Right  to  an  Appraisal. 

The  State  Comptroller  is  not  precluded  from  taking 
proceedings  in  1902  to  assess  the  transfer  tax  upon 
an  estate  where  the  decedent  died,  and  whose  will  was 
proved  in  1895,  and  the  counsel  for  the  estate  was  in- 
formed by  the  surrogate,  upon  the  basis  of  the  execu- 
tor's affidavit,  that  the  estate  was  too  small  to  be  tax- 
able, —  it  appearing  that  no  decree  was  then  or  ever 
entered  taxing  or  exempting  the  estate,  and  that  con- 
sequently no  notice  of  an  appraisal  was  ever  given 
to  the  persons  legally  entitled  thereto.  Matter  of 
Schmidt,  39  Misc.  Rep.  77,  78  N.  Y.  S.  879. 

278.  Where  Property  is  in  Several  Counties. 

Where  property  of  a  decedent  is  situated  in  several 
counties,  the  appraiser  appointed  by  the  surrogate  first 
acquiring  jurisdiction  may  appraise  all.  Matter  of 
Keenan,  22  N.  Y.  St.  Rep.  79,  5  N.  Y.  S.  200.  (Decision 
Act  1887.) 

279.  Appraisal  of  Interest  —  When  Postponed. 

If  the  interest  subject  to  tax  cannot  be  appraised 
immediately  after  the  transfer,  it  is  to  be  appraised 
at  its  fair  and  clear  market  value  at  the  date  of  its 
transfer,  whenever  such  value  can  be  ascertained. 
Matter  of  Sloane,  154  N.  Y.  109-114.    (Decision  1892.) 

280.  What  Statute  Controls  Proceedings. 

A  proceeding  for  the  ascertainment  and  determina- 
tion of  a  transfer  tax  is  controlled  by  the  statute  in 
force  at  the  time  the  proceeding  is  instituted,  but  the 


PROCEEDINGS    BY    APPRAISERS.  249 

tax  itself  and  the  rights  of  the  parties  are  controlled 
by  the  statute  in  force  at  the  time  of  the  transfer. 
Matter  of  Sloane,  154  N.  Y.  109;  Matter  of  Davis,  149 
N.  Y.  537;  Matter  of  Prime,  136  N.  Y.  347. 

281.  Notice  of  Appraisal. 

Before  the  liability  of  the  taxpayer  becomes  fixed, 
he  must  have  notice  of  the  proceedings  against  him 
and  a  hearing,  or  an  opportunity  to  be  heard,  in  refer- 
ence to  the  value  of  the  property  and  the  amount  of 
the  tax  which  is  to  be  imposed.  Matter  of  McPherson, 
104  N.  Y.  306-321. 

An  appraiser  should  mail  notices  of  the  time  and 
}3lace  when  he  will  appraise  the  property  to  all  persons 
known  to  have  a  claim  or  interest  in  the  property  to 
be  appraised,  including  the  State  Comptroller,  and  to 
such  persons  as  the  surrogate  may  by  order  direct. 
§  230  (supra). 

An  assessment  of  a  transfer  tax,  made  without  notice 
to  the  sole  heir-at-law,  is  void  as  to  her.  Matter  of 
Winters,  21  Misc.  Rep.  552,  48  N.  Y.  S.  1097. 

282.  Notice  Held  Insufficient  Under  Act  of  1887. 

A  report  showing  that  only  the  persons  whose  names 
appear  in  the  order  appointing  the  appraiser  were 
served  with  the  notice  is  insufficient.  It  should  show 
that  the  persons  served  were  all  the  persons  known 
to  the  appraiser  to  have  or  claim  any  interest  in  the 
property.  Matter  of  Astor,  6  Dem.  413,  2  N.  Y.  S. 
630. 


250  THE    LAW    OF    TAXABLE    TRANSFERS. 

283.  People  —  Interested  Party  under  Act  of  1885. 

An  appraisal  is  not  regular  where  the  record  does 
not  show  that  the  proper  officers  representing  the  peo- 
ple had  due  notice.  Matter  of  Bolton,  35  Misc.  Rep. 
688,  72  N.  Y.  S.  430. 

Under  the  Act  of  1885  the  people  were  held  to  be 
an  interested  party  although  not  cited,  and  when  the 
district  attorney  appears  in  the  proceedings  it  will  be 
assumed  that  he  had  authority  to  do  so.  Matter  of 
Arnett,  49  Hun,  599,  2  N.  Y.  S.  428. 

284.  Hearings  Before  Appraiser. 

Upon  the  hearings  before  the  appraiser  the  facts 
are  generally  presented  by  the  executor  or  adminis- 
trator in  the  form  of  affidavits,  showing  the  character 
of  the  property  left  by  the  decedent,  and  the  items  of 
each  article  of  real  or  personal  property  and  their 
value,  respectively,  at  the  time  of  the  decedent's 
death,  the  amount  and  nature  of  each  debt  paid  or 
allowed  against  the  estate,  the  testamentary  expenses, 
commissions,  etc.,  which  will  be  claimed  as  proper  de- 
ductions, and  the  names  and  relationship  of  the  lega- 
tees or  distributees,  and  such  other  information  as 
may  be  necessary  in  each  particular  case  to  fully  and 
fairly  place  before  the  appraiser  all  the  facts  neces- 
sary for  him  to  ascertain  the  clear  market  value  of 
the  decedent 's  estate,  and  the  net  amount  transferred, 
and  to  whom. 

285.  Power  of  the  Appraiser. 

The  appraiser  can  subpoena  witnesses  and  examine 
them  under  oath  as  to  the  facts  set  forth  in  the  affi- 


PROCEEDINGS    BY    APPRAISERS.  251 

davits  relative  to  the  decedent's  estate,  or  as  to  any 
other  facts  concerning  such  property  and  the  value 
thereof.      (§  230,  supra.) 

286.  May  Report  as  to  Date  of  Decedent's  Death. 

In  the  Matter  of  Beck  with  (not  reported),  it  appears 
from  the  report  of  the  appraiser  filed  in  the  State 
Comptroller's  office,  May  23,  1904,  that  Arthur  Beck- 
with,  a  resident  of  New  York  county,  on  April  24,  1894, 
escaped  from  a  sanitarium  at  Flushing,  New  York, 
where  he  was  temporarily  confined,  and  was  never 
heard  of  or  seen  after  that  time  by  any  one. 

That  in  1902  application  was  made  to  the  Surro- 
gate's Court  of  New  York  county  for  letters  of  ad- 
ministration upon  his  estate,  and  upon  the  petition 
filed  a  referee  was  appointed  to  take  proof  of  the  facts 
attending  his  disappearance  and  report  whether  he 
be  dead.  Upon  the  report  of  the  referee  it  was  ad- 
judged that  the  said  Arthur  Beckwith  was  dead,  and 
letters  of  administration  were  issued  on  the  15th  day 
of  January,  1902.  Thereafter,  transfer  tax  proceed- 
ings were  commenced,  and  then  the  question  arose  as 
to  the  date  of  his  death,  the  Comptroller  first  contend- 
ing that  his  death  must  be  fixed  as  on  or  about  the 
date  of  entry  of  the  order  granting  letters,  viz.,  Janu- 
ary 15,  1902,  while  certain  creditors  of  decedent's  de- 
ceased brother,  who  died  November  18,  1895,  were 
anxious  to  show  that  the  said  Arthur  Beckwith  died 
prior  to  the  death  of  his  insolvent  brother,  in  which 
event  the  insolvent  brother's  estate  would  be  entitled 
to  the  one-half  part  of  the  said  Arthur  Beckwith 's 
whole  estate,  which  amounted  to  nearly  $600,000.     The 


252  THE    LAW    OF    TAXABLE    TRANSFERS. 

surrogate  amended  his  former  order  directing  one  of 
the  appraisers  of  New  York  county  to  appraise  the 
decedent's  property,  by  adding  thereto  a  direction 
' '  to  take  proof  of  the  facts  and  circumstances  attend- 
ing the  death  of  said  Arthur  Beckwith,  and  to  report 
the  testimony  taken  by  said  appraiser,  and  his  con- 
clusion, as  to  the  date  of  death." 

Several  physicians  testified  that  the  physical  con- 
dition of  the  said  Arthur  Beckwith,  at  the  time  of  his 
disappearance,  was  such  that  it  would  have  been  im- 
possible for  him  to  have  lived  without  medical  treat- 
ment for  any  length  of  time  after  he  escaped,  but  the 
appraisers  fixed  the  date  of  his  death  as  seven  years 
from  April  24,  1894,  the  day  he  escaped  from  the  sani- 
tarium, and  the  surrogate  confirmed  the  report  and 
assessed  a  tax  on  the  one-half  of  his  estate  passing  to 
the  children  of  the  deceased  insolvent  brother  at  5  per 
cent.  The  administrator  appealed  from  this  finding 
of  the  appraiser  and  the  order  assessing  the  tax,  but 
the  surrogate,  by  order  entered  July  21,  1904,  over- 
ruled the  appeal  and  confirmed  the  report  of  the  ap- 
praiser, and  affirmed  the  order  assessing  the  tax 
thereon  in  all  respects. 

287.  Evidence  as  to  Declarations  of  Testator. 

Testimony  of  the  executor  as  to  the  declaration  of 
the  testator,  as  to  the  value  of  the  notes,  is  not  compe- 
tent ;  his  own  conclusions,  that  they  were  valueless,  if 
not  objected  to,  may  be  properly  considered.  Morgan 
v.  Warner,  45  App.  Div.  424,  60  N.  Y.  S.  963;  affd.,  162 
N.  Y.  612. 


PROCEEDINGS   BY   APPRAISERS.  253 

288.  Competency  of  Witness. 

A  witness  is  not  made  incompetent  by  section  829  of 
the  Code  to  testify  respecting  "  confidential  commu- 
nications and  acknowledged  relations  growing  out  of 
an  agreement  between  him  and  the  decedent,"  for 
the  purpose  of  showing  the  acknowledged  relation  of 
parent  and  child  between  the  decedent  and  the  wit- 
ness. Matter  of  Brundage,  31  App.  Div.  348.  So  a 
residuary  legatee,  son  of  decedent,  may  testify  to  in- 
terviews had  by  him  with  the  decedent  tending  to  show 
that  a  particular  legacy  was  given  to  him  by  the  will 
in  payment  of  a  debt  for  services  rendered  by  him  to 
decedent.  Matter  of  Gould,  19  App.  Div.  352,  46  N.  Y. 
S.  506. 

289.  Testimony  of  Legatee. 

A  legatee  is  not  prohibited  from  testifying  before 
an  appraiser  as  to  interviews  had  by  him  with  the  dece- 
dent, and  which  tend  to  show  why,  or  for  what  purpose 
a  particular  legacy  was  given  to  him  by  the  decedent. 
Matter  of  Brundage,  31  App.  Div.  348-353.  Citing  Mat- 
ter of  Gould,  19  App.  Div.  352,  46  N.  Y.  S.  506 ;  modified 
as  to  other  points,  156  N.  Y.  423. 

290.  Nonresident  Executor  —  When  not  Obliged  to  Testify. 

The  executor  of  a  nonresident  decedent  is  not  obliged 
to  testify  before  the  appraiser  in  reference  to  the  dece- 
dent's property  without  this  State,  or  as  to  stock  of 
foreign  corporations  owned  by  the  nonresident  dece- 
dent. Matter  of  Bishop,  82  App.  Div.  112,  81  N.  Y.  S. 
474. 


254        THE  LAW  OF  TAXABLE  TRANSFERS. 

291.  Basis  of  Value. 

The  true  test  of  value  by  which  the  tax  is  to  be  meas- 
ured is  the  value  of  the  estate  at  the  time  of  the  trans- 
fers of  title,  and  not  the  value  at  the  time  of  the  trans- 
fer of  possession.  Matter  of  Davis,  149  N.  Y.  539. 
(Decision,  Act  of  1887.) 

292.  Increase  of  Property  —  Not  to  be  Appraised. 

In  determining  the  taxable  estate  only  the  property 
of  which  a  person  dies  seized  or  possessed  is  to  be  ap- 
praised; the  increase  or  interest  thereafter  obtained 
from  such  property  is  not  to  be  included.  Matter  of 
Vassar,  127  N.  Y.  1. 

293.  Appraisal  of  Residuary  Estate  When  Part  Thereof  is  Sub- 

ject to  Appointment. 

Where  a  testator  gave  his  residuary  estate  to  his 
executors  in  trust  to  pay  the  income  to  his  widow  for 
life,  and  upon  her  death  gave  certain  specific  bequests 
therefrom,  after  which  the  remainder  was  to  go  to  a 
certain  nephew,  unless  the  widow  exercised  a  power  of 
appointment  over  $150,000  of  the  residue  which  she 
was  empowered  to  do  by  a  codicil  to  decedent's  will, 
held,  in  assessing  the  tax  upon  the  nephew's  interest, 
that  the  sum  over  which  the  widow  could  exercise  the 
appointment  must  be  deducted  in  this  proceeding. 
Matter  of  Field,  36  Misc.  Rep.  279,  73  N.  Y.  S.  512. 

294.  Effect  of  Failure  to  Tax  Known  Property. 

Where  a  surrogate,  knowing  of  the  existence  of  per- 
sonalty, does  not  tax  it,  there  is  a  determination  that 
it  is  not  taxable,  which  becomes  final  where  there  was 


PROCEEDINGS   BY    APPRAISERS.  255 

no  appeal  taken  from  the  order  of  taxation.    Matter 
of  Lansing,  31  Misc.  Rep.  148-154,  64  N.  Y.  S.  1125. 

295.  When  Omission  to  Tax  Life  Estate  Amounts  to  an  Ex- 

press Reservation  Thereof. 

Where  an  appraiser  omitted  in  his  report  to  tax  the 
life  estate  of  an  infant  in  a  trust  fund  upon  the  ground 
that  the  value  thereof  could  not  then  be  ascertained,  and 
that  the  ultimate  legatees  were  indefinite  and  uncertain, 
and  an  order  was  subsequently  entered  in  accordance 
with  the  report,  held,  that  such  omission  is  not  an  adju- 
dication that  the  interests  of  the  infant  are  not  taxable 
at  all,  but  amounts  to  an  express  reservation  of  the 
matter  of  taxation  of  such  life  estate,  and  that  it  was 
proper  to  tax  such  interests  when  they  could  be  ascer- 
tained. Matter  of  Irwin,  36  Misc.  Rep.  277,  73  N.  Y.  S. 
415. 

296.  Burden  of  Proof. 

The  State  has  the  burden  of  proving  the  facts  under 
which  the  transfer  tax  may  be  imposed.  Matter  of 
Enston,  113  N.  Y.  174-178;  Matter  of  Vassar,  127  N.  Y. 
1-12;  Matter  of  Thome,  44  App.  Div.  8,  60  N.  Y.  S. 
419;  Matter  of  Miller,  11  App.  Div.  473-479,  78  N.  Y. 
S.  930. 

297.  Worthless  Account  Excluded. 

A  worthless  account  is  to  be  excluded  in  estimating 
value  of  decedent's  taxable  estate.  So  held  as  to  an 
account  of  a  son  who  was  one  of  the  legatees  under  the 
will  of  his  father,  but  who  at  the  time  of  the  death  of 


256        THE  LAW  OF  TAXABLE  TRANSFERS. 

his  father  was  wholly  insolvent.    Matter  of  Manning, 
169  N.  Y.  449,  affg.  59  App.  Div.  624,  69  N.  Y.  S.  1140. 

298.  Report  of  Appraiser. 

The  report  of  the  appraiser  shall  be  made  in  dupli- 
cate, one  of  which  duplicates  shall  be  filed  in  the  office 
of  the  surrogate  and  the  other  in  the  office  of  the  State 
Comptroller.    (§  230,  supra.) 

299.  What  Report  Should  Show. 

The  report  should  show  that  the  property  was  ap- 
praised at  its  fair  market  value,  and  the  appraiser 
should  report  all  property  as  to  which  he  is  in  doubt 
as  subject  to  tax.  Matter  of  Astor,  17  N.  Y.  St.  R.  787 ; 
Matter  of  Hendricks,  18  N.  Y.  St.  R.  989-990,  3  N.  Y.  S. 
281. 

300.  What  Report  Should  Contain. 

The  report  should  contain  all  the  affidavits  submitted 
and  the  testimony  of  all  witnesses  produced  before  the 
appraiser,  a  schedule  containing  a  complete  list  of  all 
the  personal  property  and  the  value  of  each  item 
thereof  and  another  list  showing  the  real  estate  with  a 
brief  description  and  the  value  thereof  less  any  mort- 
gage incumbrances  or  other  liens  thereon ;  the  amount 
of  debts  and  testamentary  expenses  paid  and  the  esti- 
mated commissions,  and  additional  expenses  to  be  in- 
curred in  the  settlement  of  the  estate,  the  names  and 
relationship  of  all  legatees  or  distributees,  and  the  in- 
terest transferred  to  each  respectively.  Corporations 
claiming  exemption  should  produce  before  the  ap- 
praiser proofs  which  clearly  entitle  them  thereto;  a 


PROCEEDINGS    BY    APPRAISERS.  257 

copy  of  the  decedent's  will  should  be  attached  to  the 
report  and  a  summary  statement,  showing  the  aggre- 
gate net  amount  transferred,  and  the  particular  share 
thereof  passing  to  each  person  or  corporation.  The 
date  of  decedent's  death  and  the  names  and  addresses 
of  the  executors  or  administrators  should  be  given. 

Where  the  mutually  acknowledged  relationship  of 
parent  and  child  is  claimed  to  have  existed  between  the 
decedent  and  a  legatee,  proof  of  such  relationship 
should  be  produced  by  the  executor  or  legatee  by  the 
affidavit  or  testimony  of  at  least  two  disinterested  per- 
sons who  have  lived  in  the  neighborhood  of  the  dece- 
dent and  can  testify  as  to  such  relationship,  from  per- 
sonal conversation  with  the  decedent  and  observations 
made  during  the  period  which  would  show  that  such 
relationship  commenced  at  or  before  the  child's 
fifteenth  birthday  and  was  continuous  for  at  least  ten 
years  thereafter,  and,  since  June  1,  1905,  that  the 
parents  of  such  legatee  were  dead  at  the  time  the 
relationship  commenced. 

If  the  value  of  any  asset  or  part  of  the  decedent's 
estate  cannot  be  presently  determined,  or  where  the 
appraiser  is  in  doubt  as  to  the  immediate  taxability  of 
any  interest  transferred  by  the  decedent's  will,  the  cir- 
cumstances in  connection  therewith  should  be  fully  set 
forth  in  the  report  of  the  appraiser. 

The  value  of  every  future  or  limited  estate,  income, 
interest,  annuity,  or  remainder,  as  determined  by  the 
superintendent  of  insurance,  should  be  attached  to  each 
copy  of  the  appraisers'  report  before  such  report  ia 

filed. 

17 


258 


THE   LAW    OF   TAXABLE    TRANSFERS. 


Terminal  Annuities  and  Single  Premiums,  Whole 

Life. 
Am.  Ex.  5  per  cent. 


ANNUITIES. 

REMAINDERS. 

Age. 

ax. 

Age. 

ax. 

Age. 

IIx. 

Age. 

IIx. 

10 

16.50475 

55 

10.37017 

10 

166.4407 

55 

458.5033 

11 

16.46076 

56 

10.09472 

11 

168.5351 

56 

471.6801 

12 

16.41469 

57 

9.81450 

12 

170.7287 

57 

485.0235 

13 

16.36642 

58 

9.52988 

13 

173.0276 

58 

498.5768 

14 

16.31581 

59 

9.24127 

14 

175.4375 

59 

512.3205 

15 

16.26274 

60 

8.94928 

15 

177.9650 

60 

526.2248 

16 

16.20722 

61 

8.65445 

16 

180.6083 

61 

540.2642 

17 

16.14896 

62 

8.35742 

17 

183.3827 

62 

554.4086 

18 

16.08779 

63 

8.05876 

18 

186.2957 

63 

568.6310 

19 

16.02372 

64 

7.75900 

19 

189.3469 

64 

582.9048 

20 

15.95658 

65 

7.45885 

20 

192.5439 

65 

597.1978 

21 

15.88620 

66 

7.15921 

21 

195.8953 

66 

611.4659 

22 

15.81257 

67 

6.86074 

22 

199.4013 

67 

625.6789 

23 

15.73552 

68 

6.56420 

23 

203.0705 

68 

639.8004 

24 

15.65484 

69 

6.27048 

24 

206.9124 

69 

653.7863 

25 

15.57033 

70 

5.98022 

25 

210.9368 

70 

667.6088 

26 

15.48176 

71 

5.69422 

26 

215.1541 

71 

681.2272 

27 

15.38910 

72 

5.41286 

27 

219.5669 

72 

694.6255 

28 

15.29210 

73 

5.13592 

28 

224.1862 

73 

707.8131 

29 

15.19051 

74 

4.86279 

29 

229.0238 

74 

720.8198 

30 

15.08425 

75 

4.59264 

30 

234.0834 

75 

733.6839 

31 

14.97307 

76 

4.32477 

31 

239.3780 

76 

746.4392 

32 

14.85666 

77 

4.05856 

32 

244.9208 

77 

759.1162 

33 

14.73492 

78 

3.79392 

33 

250.7176 

78 

771.7182 

34 

14.60774 

79 

3.53109 

34 

256.7742 

79 

784.2337 

35 

14.47479 

80 

3.27017 

35 

263.1055 

80 

796.6584 

36 

14.33572 

81 

3.01349 

36 

269.7275 

81 

808.8814 

37 

14.19057 

82 

2.76062 

37 

276.6394 

82 

820.9229 

38 

14.03897 

83 

2.51052 

38 

283.8584 

83 

832.8324 

39 

13.88092 

84 

2.26066 

39 

291.3845 

84 

844.7301 

40 

13.71604 

85 

2.00986 

40 

299.2359 

85 

856.6738 

41 

13.54430 

86 

1.76061 

41 

307.4145 

86 

868.5428 

42 

13.36528 

87 

1.51750 

42 

315.9393 

87 

880.1201 

43 

13.17891 

88 

1.28611 

43 

324.8138 

88 

891.1386 

44 

12.98494 

89 

1.06704 

44 

334.0508 

89 

901.5688 

45 

12.78344 

90 

0.85453 

45 

343.6458 

90 

911.6885 

46 

12.57414 

91 

0.64497 

46 

353.6124 

91 

921.6672 

47 

12.35728 

92 

0.44851 

47 

363.9390 

92 

931.0234 

48 

12.13275 

93 

0.28761 

48 

374.6311 

93 

938.6849 

49 

11.90076 

94 

0.13605 

49 

385.6781 

94 

945.9024 

50 

11.66175 

95 

0.00000 

50 

397.0598 

95 

952.3810 

51 

11.41594 

51 

408.7648 

52 

11.16361 

52 

420.7810 

53 

10.90499 

53 

433.0958 

.  •  . 

54 

10.64036 

54 

445.6972 

The  columns  headed  ax  are  the  ones  used  in  calculating  the  value  of 
life  estates  and  annuities  and  show  the  value  of  an  annuity  of  $1  at 
various  ages. 


PROCEEDINGS   BY   APPRAISERS.  259 

For  example. —  To  find  the  value  of  a  life  estate  in  $1,000,  given  a 
person  aged  40  years,  you  would  multiply  the  value  of  an  annuity  of 
$1  to  a  person  aged  40  as  shown  in  the  column  ax  (13.71604),  by  $50. 
the  annual  interest  on  the  sum  of  $1,000  at  5  per  cent.  (13.71604X$50) 
=  $685.80. 

The  columns  headed  IIx  show  the  value  of  the  remainder  in  $1,000  at 
various  ages  after  deducting  the  life  estate  at  the  corresponding  age. 
and  where  the  life  tenant  was  40  years  old  it  would  be   $299.23. 

The  columns  IIx  would  show  the  value  of  the  remainder  in  $1  at, 
various  ages  after  deducting  the  corresponding  life  estate  by  placing 
the  decimal  point  directly  in  front  of  the  figures,  instead  of  three 
places  to  the  right.  It  will  be  noticed  that  the  value  of  the  life  estate 
plus  the  remainder  does  not  equal  $1,000.  Section  230  provides  that 
such  values  shall  be  determined  by  the  rule,  method,  and  standard  of 
mortality  and  value  employed  by  the  Superintendent  of  Insurance,  in 
ascertaining  the  value  of  policies  of  life  insurance  and  annuities,  and 
the  basis  upon  which  life  insurance  premiums  are  calculated  contem- 
plates the  payment  of  the  annual  premiums  in  advance,  and  the  pay- 
ment of  the  death  loss  at  the  end  of  the  policy  year  in  which  the  death 
of  the  assured  occurs.  Therefore,  if  the  difference  between  the  $1,000 
and  the  life  estate  ($685.80),  namely,  $314.20,  is  divided  by  $1  plus 
5  per  cent.,  it  will  be  found  to  equal  $299.23. 

While  it  is  true  that  the  average  death  claim  is  paid  within  from 
thirty  to  sixty  days,  and  that  the  remainderman  receives  his  estate 
immediately  upon  the  death  of  the  life  tenant  or  annuitant,  yet  the 
method  of  calculation  is  prescribed  by  statute,  and  therefore  there  will 
always  be  a  slight  difference  between  the  value  of  the  life  estate  plus 
the  value  of  the  remainder,  and  the  actual  value  of  the  decedent's 
estate. 


301.  The  American  Experience  Tables  of  Mortality. 

The  American  Experience  Tables  of  Mortality  with 
5  per  cent,  interest  are  used  in  the  transfer  tax  bureau 
of  the  State  Comptroller's  office  in  checking  computa- 
tions of  life  estates  and  remainders.  This  work,  how- 
ever, does  not  contemplate  even  a  passing  reference  to 
the  method  of  computing  the  value  of  the  many,  and 
in  some  instances  intricate,  problems  to  determine  the 
value  of  life  estates,  interests,  annuities,  and  remain- 
ders created  by  will,  because  the  act  requires  all  such 
computations  to  be  made  by  the  Superintendent  of  In- 
surance, but  the  foregoing  tables  are  given  at  the  re- 
quest of  the  publishers. 


260  THE   LAW    OF   TAXABLE   TRANSFERS. 

302.  Surrogate  May  Return  Report  to  Appraiser. 

Before  acting  upon  the  appraiser's  report  the  sur- 
rogate may  return  it  to  the  appraiser  for  additional 
proof.  Matter  of  Kelly,  29  Misc.  Rep.  169,  60  N.  Y.  S. 
1005. 

303.  Should  Vacate  Order  When  Report  Defective. 

Where  the  surrogate  confirms  the  appraiser's  report 
without  noticing  that  it  is  defective,  he  has  authority 
to  vacate  his  order  of  confirmation  and  send  the  report 
back  to  the  appraiser  for  correction.  Matter  of  Earle, 
74  App.  Div.  458,  77  N.  Y.  S.  503. 

304.  When  Second  Appraisal  Cannot  be  Had. 

Where  an  appraiser  reported  that  the  value  of  the 
life  interests  of  certain  devisees  could  not  at  that  time 
be  ascertained,  and  that  the  remaindermen  were  in- 
definite and  uncertain,  and  the  tax  could  not  then  be 
determined,  which  report  was  confirmed  by  the  surro- 
gate, there  is  no  authority  for  appointing  another 
appraiser  several  years  thereafter  to  appraise  the 
amounts  paid  the  life  tenants  in  the  meantime,  as  there 
had  been  no  change  in  the  estate  or  condition  of  affairs, 
except  that  the  annual  income  had  been  paid  to  the  life 
tenants  under  the  provisions  of  the  will.  Matter  of 
Lawrence,  96  App.  Div.  29,  88  N.  Y.  S.  1028. 

305.  Second  Appraisal  —  Cannot  Increase  Value  of  Assets. 

Where  the  property  of  a  decedent  has  been  once 
honestly  appraised  at  its  fair  market  value  as  of  the 


PROCEEDINGS    BY    APPRAISERS.  261 

time  of  his  death,  the  State  Comptroller  cannot  in- 
stitute a  second  appraisal  in  order  to  collect  a  tax  on  a 
foreign  newspaper  enterprise  and  on  certain  pictures 
belonging  to  decedent  upon  which  the  executor  has 
since  the  first  appraisal  received  sums  much  greater 
than  those  then  estimated  and  fixed  as  the  value.  Mat- 
ter of  Rice,  29  Misc.  Rep.  404,  61  N.  Y.  S.  911;  affd.,  56 
App.  Div.  253,  68  N.  Y.  S.  1147. 

306.  Id. —  Nor  Decrease  Deductions  for  Debts,  Etc. 

The  order  made  on  the  first  appraisal  is  conclusive 
as  to  deductions  allowed  for  debts,  etc.,  and  the  Comp- 
troller will  not  be  permitted  a  second  appraisal  in 
order  to  show  that  the  estimated  deductions  were  ex- 
cessive as  compared  with  the  actual  payments  made 
for  such  debts,  etc.    Matter  of  Rice  (supra). 

307.  Appraisal  not  Regular  —  When. 

The  report  of  the  appraiser  must  show  the  grounds 
of  his  findings,  and  an  appraisal  is  not  regular  where 
the  record  does  not  show  that  the  proper  officers  repre- 
senting the  State  have  had  due  notice.  Matter  of 
Bolton,  35  Misc.  Rep.  688,  72  N.  Y.  S.  430. 

308.  When  Report  Insufficient. 

A  report  stating  that  the  appraiser  had  appraised  all 
the  property  of  the  deceased  made  known  to  him  by  the 
executor  is  insufficient.  He  should  appraise  all  the 
property  liable  to  tax  regardless  of  the  source  of  his 
information.  Matter  of  Astor,  6  Dem.  413,  2  N.  Y.  S. 
630.    (Decision  under  Act  of  1887.) 


2(32  THE   LAW    OF   TAXABLE   TRANSFERS. 

309.  Surrogate  May  Order  Further  Appraisal. 

Under  section  230,  chapter  908,  Laws  1896,  the  sur- 
rogate had  power  to  order  a  further  appraisal,  where 
personal  property  claimed  by  a  daughter  was  not 
taxed,  but  which  was  subsequently  adjudged  as  belong- 
ing to  the  decedent.  Matter  of  Lansing,  31  Misc.  Rep. 
148,  64  N.  Y.  S.  1125. 

310.  Uew  Proceeding. 

In  a  new  proceeding  to  appraise  property  of  dece- 
dent omitted  from  the  first  appraisal,  it  should  clearly 
appear  in  the  report  that  all  of  the  remaining  prop- 
erty of  the  estate,  subject  in  any  contingency  to  the 
payment  of  the  tax,  is  embraced  within  the  proceeding. 
Matter  of  Earle,  74  App.  Div.  458,  77  N.  Y.  S.  503. 

31 1 .  Former  Proceeding. 

A  transfer  tax  proceeding  in  this  State  expressly 
limited  to  real  estate  does  not  operate  to  suspend  pro- 
ceedings to  tax  personalty  not  disclosed  on  the  first  ap- 
praisal. Matter  of  Crerar,  31  Misc.  Rep.  481,  65  N.  Y. 
S.  573 ;  revd.  on  other  points,  56  App.  Div.  479,  67  N.  Y. 
S.  795. 

312.  Appraisal  of  Bonds,  Stocks,  and  Securities. 

Chapter  34,  Laws  of  1891,  in  effect  February  25th  of 
that  year,  provides  as  follows: 

Whenever  by  reason  of  the  provisions  of  any  law  of  this 
state  it  shall  become  necessary  to  appraise  in  whole  or  in 
part  the  estate  of  any  deceased  person,  or  of  any  insolvent 
estate  in  the  hands  of  a  receiver,  or  of  any  assignee  for  the 
benefit  of  creditors,  or  of  any  corporation  in  the  hands  of  a 


PROCEEDINGS    BY    APPRAISERS.  263 

receiver  or  otherwise,  the  persons  whose  duty  it  shall  be  to 
make  such  appraisal  shall  value  the  real  estate  at  its  full  and 
true  value,  taking  into  consideration  actual  sales  of  neighbor- 
ing real  estate  similarly  situated  during  the  year  immediately 
preceding  the  date  of  such  appraisal,  if  any ;  and  they  shall 
value  all  such  property,  stocks,  bonds  or  securities  as  are 
customarily  bought  or  sold  in  open  markets  in  the  city  of 
Xew  York  or  elsewhere,  for  the  day  on  which  such  appraisal 
or  report  may  be  required,  by  ascertaining  the  range  of  the 
market  and  the  average  of  prices  as  thus  found,  running 
through  a  reasonable  period  of  time. 

In  re  Crary,  31  Misc.  Rep.  72,  64  N.  Y.  S.  566,  the 
surrogate  held  that  a  period  of  three  months  imme- 
diately preceding  decedent 's  death  would  ordinarily  be 
considered  a  reasonable  time  within  which  to  take  the 
range  of  securities  owned  by  decedent. 

In  re  Gould,  19  App.  Div.  352,  46  N.  Y.  S.  506,  it  was 
held  that  the  rule  laid  down  in  the  above  statute  gov- 
erned the  appraiser  in  fixing  the  fair  market  value  of 
securities  as  required  by  the  Transfer  Tax  Act  of  1892, 
and  that  where  no  sales  are  made,  he  must  determine 
their  value  from  the  best  information  he  can  obtain. 
That  the  number  of  shares  held  by  a  decedent  which, 
if  sold  at  one  time,  might  depreciate  the  value,  is  not 
to  be  considered  by  the  appraiser.  And  in  the  Matter 
of  Ottendorfer,  N.  Y.  Law  Journal  of  Jan.  14,  1903, 
Fitzgerald,  surrogate,  held  that  this  rule  applied  to 
the  Transfer  Tax  Act  of  1896  also. 

Although  the  foregoing  decisions  hold  to  the  con- 
trary, the  practice  has  been  to  take  into  consideration 
the  value  of  such  stocks,  etc.,  for  a  period  subsequent 


264  THE   LAW    OF   TAXABLE    TRANSFERS. 

to  the  decedent's  death,  as  well  as  a  like  period  prior 
to  his  death,  generally  six  weeks  before  and  six  weeks 
after,  and  assess  the  stocks,  etc.,  at  the  range  of  prices 
during  that  period  rather  than  for  a  period  of  three 
months  immediately  prior  to  decedent's  death. 

It  will  be  observed  that  in  the  above  statute  where 
real  estate  is  to  be  appraised  the  sales  of  real  estate 
which  are  to  be  considered  are  actual  sales  within  one 
year  immediately  preceding  the  appraisal,  not  the  de- 
cedent's death,  and  under  the  Transfer  Tax  Law  the 
value  is  to  be  determined  as  of  the  decedent's  death, 
and  not  as  of  the  date  of  the  appraisal.  Therefore  it 
is  questionable  whether  the  courts  would  hold  that  this 
statute  applied  also  to  the  appraisal  of  real  estate  in 
transfer  tax  proceedings. 

313.  Stocks  of  Domestic  Corporations  are  Appraised  at  Their 
Market  Value  Kegardless  of  Where  Their  Capital  is 
Employed. 

In  Matter  of  Palmer,  N.  Y.  Law  Journal  of  May 
11,  1904,  it  appeared  that  the  only  property  of  a 
nonresident  decedent  taxable  under  the  Transfer  Tax 
Law  of  this  State  was  certain  shares  of  stock  of 
the  New  York  Central  and  Hudson  River  Railroad 
Company,  which  stock  was  appraised  at  its  market 
value  and  a  transfer  tax  assessed  thereon.  The 
executors  appealed  on  several  grounds,  one  of  which 
was  "  that  said  report  and  order  erroneously  fix 
the  value  of  the  said  property  for  the  purpose  of 
taxation  herein,  upon  the  basis  of  the  market  value 


PROCEEDINGS    BY    APPRAISERS.  265 

of  the  stock  of  the  New  York  Central  and  Hudson  River 
Railroad  Company  passing  under  said  will  as  found 
by  the  appraiser  herein,  without  deducting  therefrom 
35.94  per  cent,  of  the  said  market  value,  being  the  pro- 
portion of  the  capital  of  the  said  New  York  Central 
and  Hudson  River  Railroad  Company  employed  with- 
out the  State  of  New  York  at  the  time  of  the  death  of 
the  said  decedent."  Surrogate  Thomas  of  New  York 
county  affirmed  his  taxing  order  saying : ' '  The  grounds 
upon  which  shares  of  stock  in  a  domestic  corporation 
owned  by  a  nonresident  at  the  time  of  his  death  are 
held  subject  to  the  transfer  tax,  were  fully  considered 
in  the  Matter  of  Bronson,  150  N.  Y.  1." 

The  Appellate  Division  of  the  First  Department  affirmed  the  order  of 
the  Surrogate,  without  opinion,  Feb.  24,  1905. 

314.  unlisted  Stocks,  Appraisal  of. 

Where  it  appeared  that  during  the  first  and  second 
years  of  its  existence  a  corporation  paid  in  each  year 
an  8  per  cent,  dividend;  that  there  was  no  regular 
market  value  for  the  stock,  but  that  in  January,  1897, 
two  months  before  the  decedent's  death,  an  officer  of 
the  corporation  sold  500  shares  of  the  stock,  having  a 
par  value  of  $100  a  share,  at  $50  per  share,  and  that  in 
July  of  the  same  year  he  sold  a  like  number  of  shares 
for  the  same  price,  and  such  officer  testified  that  such 
price  was  the  fair  value  of  the  stock,  in  the  absence  of 
any  evidence  as  to  the  actual  earnings  of  the  corpora- 
tion, other  than  the  statement  of  the  officers  that  the 
dividends  were  declared  out  of  its  earnings,  held,  that 
the  evidence  did  not  justify  a  finding  that  the  value  of 
the  stock  was  greater  than  $50  per  share.  Matter  of 
Smith,  71  App.  Div.  602,  76  N.  Y.  S.  185. 


266  THE    LAW    OF   TAXABLE    TRANSFERS. 

315.  Joint-Stock  Associations. 

The  shares  of  a  joint-stock  association  constitute 
personal  property  and  are  taxable  as  such,  irrespective 
of  the  character  of  the  property  represented  thereby, 
whether  real  or  personal,  and  where  the  shares  are  not 
listed  upon  the  Stock  Exchange  or  sold  in  the  open 
market,  the  value  of  the  realty  may  be  considered  upon 
an  appraisal  in  order  that  their  value  may  be  estab 
lished.  Matter  of  Jones,  172  N.  Y.  575,  revg.  69  App. 
Div.  237,  74  N.  Y.  S.  702. 

316.  Joint-Stock  Associations  and  Corporations,  Difference  Be- 

tween. 

The  fact  that  a  joint-stock  association  is  not  in  legal 
contemplation  a  corporation,  and  not  liable  to  taxation 
under  acts  seeking  to  reach  corporations,  in  no  way 
militates  against  the  position  assumed  by  the  Comp- 
troller. It  is  competent  for  private  individuals  to 
create  a  joint-stock  association,  issue  shares  of  stock, 
and  in  that  form  dispose  of  property  by  last  will  and 
testament.  The  associates  by  contract  have  created  the 
same  situation  as  to  shares  of  stock  that  a  corporation 
secures  by  charter.  Matter  of  Jones,  172  N.  Y.  575- 
581. 

317.  Taxable  Value  —  Where  There  is  no  Market  Value. 
Where  there  is  no  market  value  for  the  extremely 

profitable  stock  of  a  porous  plaster  company,  because 
the  stock  is  not  for  sale,  an  appraiser  may  properly 
estimate  its  taxable  value  upon  the  basis  of  the  earning 
capacity  of  the  corporation,  its  good-will,  and  the  value 


PROCEEDINGS   BY   APPRAISERS.  267 

of  its  secret  recipes  used  in  the  manufacture.    Matter 
of  Brandreth,  28  Misc.  Rep.  468,  59  N.  Y.  S.  1092. 

318.  Appraisal  of  Inactive  Stock. 

The  State,  upon  the  appraisal  of  an  inactive  stock, 
may  properly  introduce  as  evidence  of  the  fair  market 
value,  the  opinion  of  witnesses  qualified  to  answer ;  the 
price  quotations  of  the  stock  contained  in  market  re- 
ports and  authentic  publications ;  the  prices  established 
by  actual  sales  made  in  the  regular  course  of  business, 
even  though  not  made  on  the  exchanges,  and  in  the  ab- 
sence of  other  competent  evidence,  the  actual  or  in- 
trinsic value  of  the  property  itself.  Matter  of  Proctor, 
41  Misc.  Rep.  79,  83  N.  Y.  S.  643. 

319.  The  Test  of  Value. 

The  true  test  of  value  by  which  the  tax  is  to  be 
measured  is  the  value  of  the  estate  at  the  time  of  the 
transfer  of  title  and  not  the  value  at  the  time  of  the 
transfers»of  possession.  Matter  of  Davis,  149  N.  Y.  539. 
(Decided,  Act  1887.) 

320.  Note*  Directed  to  be   Canceled,  Appraisal  of. 
Where  a  testator  directs  his  executor  to  cancel  and 

surrender  certain  promissory  notes  to  the  makers 
thereof,  without  payment,  such  notes  should,  for  the 
purposes  of  determining  the  transfer  tax  thereon,  be 
appraised  at  their  fair  market  value  and  not  at  their 
face  value.  Morgan  v.  Warner,  45  App.  Div.  424,  60 
N.  Y.  S.  963;  affd.,  162  N.  Y.  612. 


268        THE  LAW  OF  TAXABLE  TRANSFERS. 

3-21.  Notes  or  Claims  in  Litigation. 

The  amount  of  a  note  on  which  suit  has  been  brought 
by  the  administrator  and  is  still  pending  when  an  ap- 
praisal for  a  transfer  tax  is  made  should  be  excluded 
from  the  valuation  and  reserved  for  future  appraise- 
ment in  case  the  administrators  succeed  in  collecting  it. 
Matter  of  Westurn,  152  N.  Y.  93. 

322.  Disputed  Claim  —  Not  Appraised  at  Face  Value. 
Where  an  executor  has  made  an  advantageous  com- 
promise of  a  claim  in  favor  of  the  estate,  the  amount 
actually  received,  and  not  the  face  value  of  the  claim  is 
the  proper  basis  for  the  appraisal  value.  Matter  of 
Thomas,  39  Misc.  Eep.  223,  79  N.  Y.  S.  571. 

323.  Appraiser  Taking  Fee  or  Reward. 

Seotion  14  of  the  Act  of  1885  made  it  a  misdemeanor 
for  an  appraiser  to  take  any  fee  or  reward  from  any 
person  liable  to  pay  the  tax  or  any  portion  thereof. 
In  the  Act  of  1892  this  section  was  omitted  from  the 
Transfer  Tax  Law,  but  in  1893,  by  chapter  692  of  the 
laws  of  that  year,  a  similar  provision  was  added  to  the 
Penal  Code  in  reference  to  an  appraiser  accepting  any 
fee  or  reward.    (See  §  48c  of  the  Penal  Code.) 

324.  Corresponding  Sections  of  Former  Acts  Relating  to  Pro- 

ceedings by  Appraisers. 

Section  13  of  the  Act  of  1885  provided  for  the  ap- 
pointment of  some  competent  person  to  act  as  ap- 
praiser by  the  surrogate  of  the  proper  county,  and  also 
contained  provisions  respecting  the  proceedings  by  the 
appraiser.    This  section  was  amended  by  chapter  713, 


PROCEEDINGS    BY   APPRAISERS.  269 

Laws  1887,  and  chapter  307,  Laws  1889,  and  as 
amended  was  re-enacted  as  sections  11  and  12  of  the 
Act  of  1892,  said  sections  becoming  sections  230  and 
231  of  the  Act  of  1896.  Section  230,  however,  contain- 
ing a  new  provision  to  the  effect  that  whenever  an  es- 
tate for  life  or  for  years  can  be  divested  by  the  act  or 
omission  of  the  legatee  or  devisee,  it  shall  be  taxed  as 
if  there  were  no  possibility  of  such  divesting.  See 
Matter  of  Sloane,  154  N.  Y.  109. 

Section  230  was  amended  by  chapter  284,  Laws  1897, 
in  effect  April  16th  of  that  year,  providing  that  the 
taxation  of  estates  in  expectancy  which  are  contingent 
or  defeasible  shall  be  appraised  at  their  full  undimin- 
ished value  when  the  persons  entitled  thereto  shall 
come  into  beneficial  enjoyment  or  possession  thereof, 
without  diminution  for  or  on  account  of  any  valuation 
theretofore  made  of  the  particular  estate  for  purposes 
of  taxation,  upon  which  said  estates  in  expectancy  may 
have  been  limited.  This  provision  was  doubtless  in- 
advertently omitted  from  the  amendment  to  this  sec- 
tion by  chapter  76,  Laws  1899,  in  effect  March  14th  of 
that  year,  because  it  was  re-enacted  by  the  amendment 
to  said  section  by  chapter  173,  Laws  1901,  in  effect 
April  1st  of  that  year,  including  the  words  "  and  in 
which  proceedings  for  the  determination  of  the  tax 
have  not  been  taken  or  where  the  taxation  thereof  has 
been  held  in  abeyance,"  which  were  added  by  this  last 
amendment.  See  Matter  of  Kennedy,  93  App.  Div.  27, 
as  to  the  effect  of  the  re-enactment  of  the  provision  in 
1901,  with  reference  to  the  present  taxation  of  all  con- 
tingent  estates   since   chapter   76,   Laws   1899.     The 


270  THE   LAW    OF    TAXABLE    TRANSFERS. 

amendment  of  1897  further  provides  that  in  estimating 
the  value  of  any  estate  where  the  persons  are  presently 
entitled  thereto,  no  allowance  shall  be  made  in  respect 
to  any  contingent  incumbrance  thereon,  nor  for  any 
contingency  upon  the  happening  of  which  the  estate  or 
some  part  thereof  might  be  abridged,  defeated,  or  di- 
minished, and  providing  for  a  return  of  a  proportion- 
ate amount  of  the  tax  paid  thereon,  in  the  event  of  such 
contingent  incumbrance  taking  effect.  Said  amend- 
ment further  provided  that  where  any  property  is 
transferred,  subject  to  any  charge  determinable  by  the 
death  of  any  person  or  only  ascertainable  by  reference 
to  the  death  of  any  person,  the  increase  of  benefit  ac- 
cruing, upon  the  extinction  of  such  charge,  shall  be 
deemed  a  transfer  and  taxable.  Also  that  when  prop- 
erty is  bequeathed  or  devised  in  trust  for  persons  in 
succession  who  are  taxable  at  the  same  rate,  the  trus- 
tees thereof  shall  pay  the  tax  out  of  the  principal  of  the 
trust  fund,  to  which  the  particular  estates  and  the  ex- 
pectant estates  limited  thereon  may  be  liable,  respect- 
ively, and  that  where  such  remainders  or  expectant 
estates  are  so  circumstanced  that  the  taxes  are  not 
presently  payable,  or  where  property  is  devised  or  be- 
queathed to  persons  and  corporations  who  are  not  tax- 
able at  the  same  rate,  the  county  treasurer  or  the  city 
comptroller,  by  and  with  the  consent  of  the  State 
Comptroller,  may  effect  a  composition  of  said  taxes 
upon  such  terms  as  may  be  deemed  equitable. 

By  chapter  76,  Laws  1899,  in  effect  March  14th  of 
that  year,  section  230  was  further  amended  by  adding 
a  provision  to  the  effect  that  ' '  whenever  a  transfer  of 
property  is  made  upon  which  there  is  or  in  any  con- 


PKOCEEDINGS    BY   APPRAISERS.  271 

tingency  there  may  be  a  tax  imposed,  such  property 
shall  be  appraised  at  its  clear  market  value  imme- 
diately upon  such  transfer,  or  as  soon  thereafter  as 
practicable. ' '  This  amendment  was  a  revision  of  part 
of  the  amendment  to  section  230  by  chapter  284  of  the 
Laws  of  1897,  and  was  omitted  from  the  Act  of  1905 
for  the  reason  doubtless  that  the  words,  "  or  as  soon 
thereaiter  as  practicable,"  referred  to  the  appraisal 
of  property,  the  transfer  of  which  was  subject  to  some 
contingency,  which  property,  under  other  provisions 
of  the  amendment  of  1899,  respecting  contingent  es- 
tates, was  held  presently  taxable  at  the  highest  rate, 
etc,  Matter  of  Vanderbilt,  172  N.  Y.  69.  The  other 
provision  in  reference  to  the  appraisal  of  property 
"  at  its  clear  market  value  immediately  upon  such 
transfer  "  was  already  covered  by  section  220,  which 
says  that  "A  tax  shall  be  and  is  hereby  imposed  upon 
the  transfer  of  any  property,"  etc.  Subdivision  6  of 
said  section  providing  that  the  tax  imposed  hereby 
shall  be  "  upon  the  clear  market  value  of  such 
property."  This  amendment  also  provided  that  all 
estates  in  remainder  which  vested  prior  to  June  30, 
1885,  but  which  will  not  come  into  actual  possession  or 
enjoyment  of  the  persons  beneficially  entitled  thereto 
until  after  the  passage  of  the  amendment,  shall  be  tax- 
able as  soon  as  the  persons  come  into  actual  possession 
or  enjoyment  thereof.  This  provision  was  held  uncon- 
stitutional.    Matter  of  Pell,  171  N.  Y.  18. 

This  amendment  also  contains  a  provision  for  the 
immediate  taxation  of  contingent  estates  at  the  highest 
rate  possible,  and  provides  that  the  tax  shall  be  paid 


2 .  2  THE   LAW    OF    TAXABLE    TRANSFERS. 

forthwith  out  of  the  property  transferred,  and  also 
provides  for  the  return  of  the  excess  of  tax,  if  it  sub- 
sequently develops  that  the  property  passed  to  those 
taxable  at  the  lower  rate  with  interest.  See  Matter  of 
Vanderbilt,  172  N.  Y.  69. 

Chapter  658,  Laws  1900,  in  effect  April  25th  of  that 
year,  amended  section  230  by  providing  for  the  ap- 
pointment and  removal  of  salaried  appraisers,  stenog- 
raphers, etc.,  in  New  York,  Kings,  and  Erie  counties. 

Chapter  173,  Laws  1901,  in  effect  April  1st  of  that 
year,  provided  for  the  appointment  of  salaried  ap- 
praisers in  Albany,  Dutchess,  Monroe,  Oneida,  Onon- 
daga, Orange,  Queens,  Rensselaer,  Richmond,  Suffolk, 
and  Westchester  counties,  and  fixed  their  salaries,  and 
re-enacted  the  provision  in  reference  to  "  estates  in 
expectancy."  (See  amendment  by  chap.  284,  Laws 
1897,  supra.) 

Chapter  493,  Laws  1901,  in  effect  April  23d  of  that 
year,  provides  that  the  State  Comptroller  shall  be  an 
interested  party  to  institute  proceedings  to  determine 

tax. 

Chapter  496,  Laws  1902,  in  effect  April  30th  of 
that  year,  increases  the  number  of  stenographers  in 
New  York  county  and  provides  for  interest  upon  re- 
funds under  chapter  76,  Laws  1899,  at  3  per  cent,  in- 
stead of  6  per  cent.  The  amendment  by  chapter  758, 
Laws  1904,  made  the  salary  of  the  appraiser  of  Albany 
county  to  not  exceed  $2,500. 

Chapter  368,  Laws  1905,  amends  former  section  230 
of  the  Act  of  1896,  as  amended,  by  placing  the  pro- 
visions thereof  respecting  the  appointment  of  ap- 
praiser's   stenographers,    etc,    in    section    229,    and 


PROCEEDINGS    BY   APPRAISERS.  273 

amending  the  title  of  section  230  so  it  shall  read  ' '  Pro- 
ceedings by  Appraisers."  The  provisions  of  former 
section  231,  relating  to  proceedings  by  appraisers,  are 
now  to  be  found  re-enacted  in  section  230  of  the  Act  of 
1905,  and  the  provisions  immediately  following  are  the 
the  same  as  the  provisions  respectively  in  former  sec- 
tion 230,  except  that  the  last  paragraph  of  this  section 
in  reference  to  the  report  of  the  appraiser  is  taken 
from  former  section  232. 
18 


CHAPTER  XIV. 


Proceedings  by  Appraisers  —  Value  of  Future  and 
Limited  Estates  —  How  Determined. 

(§  230,  Tax  Law.) 


325 
326. 


327. 

328. 
329. 

330. 

331. 

332. 
333. 
334. 
335. 


336. 


537. 


The  general  subject. 

Valuation  of  life  estate; 
where  life  tenant  dies  prior 
to  appraisal. 

Valuation  of  remainder  in- 
terests subject  to  life  an- 
nuity; where  annuitant  ex- 
ceeds his  expectation  of  life. 

Vested  and  contingent  future 
estates  and  remainders. 

History  of  the  law  effecting 
life  estates  and  remainders 
prior  to  1899. 

a  —  Taxing  expectant  estates 
at  their  full  undiminished 
value. 

b  —  Taxing  transfer  upon  the 
exercise  of  a  power  of  ap- 
pointment. 

c  —  Transfer  subject  to  a  con- 
tingent incumbrance. 

d  —  Increase  accruing ;  when 
deemed  a  taxable  transfer. 

Contingent  remainders  since 
1899,  are  presently  taxable. 

The  provisions  of  the  amend- 
ments of  1899  (sec.  230) 
apply  equally  to  the  pay- 
ment of  tax  on  vested  as 
well  as  contingent  remain- 
ders. 

When  contingent  or  vested  re- 
mainder not  presently  tax- 
able. 

a  —  Where  life  tenant  can  use 
a  part  or  all  of  the  princi- 
pal. 

[27 


338. 

339. 
340. 

341. 

342. 
343. 

344. 
345. 
346. 

347. 
348. 

349. 

350. 

351. 
352. 

4] 


b  —  Where  life  tenant  can  ex- 
ercise a  power  of  appoint- 
ment over  the  fund. 

Words;  not  enlarging  a  life 
estate. 

Discretionary  power  to  bene- 
ficiary to  use  principal 
creates  a  voidable  trust. 

Annuities ;  value  of,  how  ascer- 
tained. 

Id.;  payment  of  tax  upon. 

Id.;  tax  on  fund  subject  to 
annuities. 

Id.;  when  cost  of  annuity  de- 
termines its  value  as  affect- 
ing the  residuary  estate. 

Taxes  on  remainder  in  trust 
estates  are  presently  pay- 
able. 

The  Transfer  Tax  Law  does 
not  apply  to  remainders  and 
reversions  created  before  it 
went  into  effect. 

The  Act  of  1885 ;  remainder 
created  by  deed. 

Defeasible  interests  —  trans- 
fers of  —  refers  to  testator's 
death. 

Decision  prior  to  Chapter  76, 
Laws  1899;  when  contingent 
interests  taxable  under  Act 
of   1885. 

Contingent  and  expectant  es- 
tates; Act  of  1892. 

Vested  interests;  when  taxable. 

Contingent  interests ;  when 
taxable. 


FUTURE   AND    LIMITED    ESTATES.  275 

325.  The  General  Subject. 

Section  13  of  the  Act  of  1885  provided  that  from  the 
report  of  the  appraiser  the  surrogate  shall  forthwith 
assess  and  fix  the  then  cash  value  of  all  estates,  annui- 
ties, and  life  estates,  or  term  of  years  growing  out  of 
said  estate  and  the  tax  to  which  the  same  is  liable. 

By  this  provision  the  surrogate  of  each  county  in 
the  State  was  authorized  to  compute  the  value  of  the 
estates  or  interests  mentioned,  and  to  expedite  matters 
it  is  doubtless  true  that  this  authority  was  assumed  in 
many  instances  by  the  appraiser  or  the  attorneys  con- 
ducting the  proceedings,  and  therefore  the  number  who 
actually  participated  in  fixing  the  value  of  such  estates 
was  increased  ad  infinitum.  The  act  did  not  state  by 
what  method  the  computation  should  be  made,  but  they 
were  generally  made  by  the  Northampton  table.  Mat- 
ter of  Robertson,  5  Dem.  92. 

By  chapter  713,  Laws  1887,  in  effect  June  25th  of 
that  year,  section  13  was  amended  so  that  the  value  of 
every  future  contingent  or  limited  estate  should  be  de- 
termined by  the  rule,  method,  and  standard  of  mortal- 
ity and  of  value  employed  by  the  Superintendent  of 
Insurance  Department  in  ascertaining  the  value  of 
policies  of  life  insurance,  save  that  the  rate  of  interest 
to  be  assessed  in  such  computations  shall  be  5  per  cent, 
per  annum,  and  providing  further  that  the  Superin- 
tendent of  the  Insurance  Department  shall,  on  the  ap- 
plication of  any  surrogate,  determine  such  values,  and 
his  certificate  shall  be  conclusive  evidence  that  the 
method  of  computation  adopted  therein  is  correct. 

This  provision  has  been  retained  in  the  amendments 


276  PROCEEDINGS  BY  APPRAISERS. 

since  1887,  and  was  re-enacted  by  chapter  368,  Laws 
1905  (§§  230,  231).     (See  tables  at  page  258.) 

The  courts  have  recognized  this  provision  of  the 
statute  in  several  instances.  Matter  of  Maresi,  74  App. 
Div.  76,  77  N.  Y.  S.  76;  Matter  of  Tracy,  179  N.  Y.  501- 
510.  And  the  right  to  have  these  computations  made 
in  this  way  has  not  been  questioned  in  our  courts,  which 
is,  at  least,  some  evidence  that  the  provision  has  proven 
a  satisfactory  one.  In  the  Matter  of  Robertson,  5  Dem. 
92,  the  court  held  that  the  fact  that  the  life  tenant  was 
in  poor  health  and  not  likely  to  live  as  long  as  the 
annuity  tables  indicated  cannot  be  considered  in  ap- 
praising the  value  of  the  life  estate,  as  the  law  fixes 
absolutely  the  method  to  be  pursued. 

326.  Valuation   of   Life   Estate  —  Where   Life   Tenant  Dies 
Prior  to  Appraisal. 

It  has  occasionally  happened  that  where  an  estate  is 
given  for  life  with  remainder  over,  that  the  life  tenant 
has  only  survived  the  decedent  a  short  time,  and  died 
prior  to  the  institution  of  transfer  tax  proceedings 
upon  the  decedent's  estate,  and  the  question  was  raised 
as  to  the  manner  of  ascertaining  the  value  of  the  life 
estate.  In  the  Matter  of  Jones,  28  Misc.  Rep.  356,  59 
N.  Y.  S.  983,  it  was  held  that  where  the  collateral  in- 
heritance tax  is  governed  by  chapter  713,  Laws  1887, 
it  is  erroneous  to  appraise  a  life  estate  given  by  the 
testator  to  his  widow  who  died  before  the  appraisal, 
upon  the  basis  of  its  actual  duration^  as  the  entire 
property  or  estate  by  which  the  life  estate  is  supported 
or  of  which  it  was  a  part  is  required  by  the  statute  to 
be  valued,  and  by  the  standards  of  mortality  and  value 


FUTURE   AND   LIMITED   ESTATES.  277 

which  were  employed  at  the  time  by  the  Superintendent 
of  Insurance. 

327.  Valuation  of  Remainder  Interests  Subject  to  Life  An- 
nuity—  Where  Annuitant  Exceeds  His  Expectation 
of  Life. 

Where  the  decedent  died  in  1889,  giving  his  wife  an 
annuity  of  $5,500  per  year,  with  remainder  to  certain 
collateral  relatives,  and  providing  that  if  the  income  of 
his  estate  was  insufficient  to  pay  the  annuity  that  the 
balance  necessary  to  make  up  the  annuity  was  to  be 
taken  from  the  principal  of  the  estate,  and  it  appeared 
that  it  was  necessary  to  resort  to  the  principal  to  make 
up  the  annuity,  it  was  held  in  proceedings  instituted 
upon  the  decedent's  estate  in  1895,  that  the  annuity  to 
the  widow  was  not  taxable  and  that  the  rights  of  the 
remaindermen  were  not  presently  ascertainable.  The 
widow  died  in  November,  1900,  and  a  proceeding  was 
thereafter  commenced  to  determine  the  value  of  the 
remainder  interests,  and  by  the  report  of  the  appraiser 
the  life  annuity  of  the  widow  was  computed  in  accord- 
ance with  her  expectancy  of  life  as  shown  by  the  Super- 
intendent of  Insurance,  and  such  sum  deducted  from 
the  trust  fund  and  the  balance  was  taxed.  The  surro- 
gate held  that  this  manner  of  procedure  was  erroneous 
because,  while  the  widow,  who  was  sixty-nine  years  of 
age  at  the  time  of  her  husband's  death,  at  which  time 
her  chance  of  life  was  less  than  six  years,  yet  she  had 
actually  survived  him  nearly  twelve  years,  and  that  the 
value  of  her  annuity  must  be  computed  upon  the  actual 
time  she  enjoyed  it.  The  court  said:  "  If  the  widow 
had  lived  long  enough  the  estate  would  have  been  en- 


278  PROCEEDINGS  BY  APPRAISERS. 

tirely  consumed  by  her  annuity,  and  a  ruling  which 
would  require  a  tax  to  be  imposed  against  the  residuary 
legatees,  even  if  they  had  never  been  entitled  to  any 
sum  whatever,  should  be  avoided."  Matter  of  Hall,  36 
Misc.  Rep.  618,  73  N.  Y.  S.  1124. 

The  practice  lately  has  been,  however,  in  all  in- 
stances, to  have  the  value  of  the  life  estate  and  re- 
mainder interests  computed  by  the  Superintendent  of 
Insurance  as  provided  by  the  statute,  regardless  of  the 
fact  that  the  actual  duration  of  the  life  estates  or  the 
vesting  of  the  contingent  interests  in  possession  might 
show  such  computations  to  be  erroneous  in  that  par- 
ticular case. 

328.  Vested  and  Contingent  Future  Estates  and  Remainders. 
The  law  favors  the  vesting  of  estates  as  soon  as  pos- 
sible after  the  testator's  death,  and  a  will,  in  doubtful 
cases,  is  construed  accordingly,  but  the  question  is  one 
of  intent.  Stokes  v.  Weston,  142  N.  Y.  433 ;  Byrnes  v. 
Stillwell,  103  N.  Y.  453;  Smith  v.  Edwards,  88  N.  Y. 
92-109;  Bowditch  v.  Ayrault,  138  N.  Y.  222;  Scott  v. 
Guernsey,  48  N.  Y.  106. 

a.  An  estate  is  vested,  when  there  is  an  immediate  fixed 
right  of  present  or  future  enjoyment. 

b.  An  estate  is  vested  in  possession,  when  there  exists  a 
right  of  present  enjoyment. 

c.  An  estate  is  vested  in  interest,  when  there  is  a  present 
fixed  right  of  future  enjoyment. 

d.  An  estate  is  contingent,  when  a  right  of  enjoyment  is  to 
accrue  on  an  event  which  is  dubious  and  uncertain.  Thomas 
on  Estates  Created  by  Will,  Vol.  1,  page  259. 

While  the  appraiser,  under  the  earlier  law,  was  di- 
rected to  determine  the  value   of  the  whole   estate 


FUTUKE    AND   LIMITED   ESTATES.  279 

passing,  yet,  as  to  the  remainders  created  by  the  de- 
cedent's will,  he  could  only  report  as  taxable  the  value* 
of  such  remainders  as  were  vested,  and  was  obliged  to 
report  as  to  all  contingent  remainders,  that  as  it  was 
not  then  possible  to  determine  to  whom  such  remain- 
ders would  ultimately  pass,  that  they  were  not  there- 
fore presently  taxable. 

329.  History  of  the  Law  Affecting  Life  Estates  and  Remain- 
ders Prior  to  1899. 

It  was  the  intention  under  the  earlier  law  to  tax  all 
taxable  transfers,  including  remainder  interests,  im- 
mediately after  the  death  of  the  decedent,  section  2  of 
the  Act  of  1885  providing  for  the  immediate  appraisal 
of  the  estate  and  after  deducting  therefrom  the  value 
of  the  life  estate,  or  term  of  years,  the  tax  on  the  re- 
mainder shall  be  immediately  due  and  payable,  and  re- 
main a  lien  on  the  property  until  paid.  But  prior  to 
the  enactment  of  chapter  76,  Laws  1899,  the  courts 
uniformly  held  that  contingent  remainders  or  estates 
were  not  to  be  appraised  or  subject  to  taxation  until 
the  contingency  happens  and  it  was  ascertainable  to 
whom  such  remainders  would  pass.  Matter  of  Cager, 
111  N.  Y.  343;  Matter  of  Stewart,  131  N.  Y.  274;  Mat- 
ter of  Curtis,  142  N.  Y.  219;  Matter  of  Hoffman,  143 
X.  Y.  327. 

Chapter  399,  Laws  1892,  section  11,  provided  that 
if  the  property  upon  the  transfer  of  which  a  tax  is  im- 
posed shall  be  an  estate,  income,  or  interest  for  a  term 
of  years,  or  for  life,  or  determinable  upon  any  future 
or  contingent  estate,  or  shall  be  a  remainder  or  other 


280  PROCEEDINGS  BY  APPRAISERS. 

expectancy,  the  entire  estate  should  be  appraised  im- 
mediately after  such  transfer  "  or  as  soon  thereafter 
as  may  be  practicable,"  provided  that  when  such  estate 
shall  be  of  such  a  nature  that  its  fair  and  clear  market 
value  cannot  be  ascertained  it  shall  be  appraised  at  the 
time  when  such  value  first  became  ascertainable,  and 
section  3  of  the  Act  of  1892  provided  that  all  taxes 
upon  estates  dependent  upon  contingent  or  future 
events  by  reason  of  which  the  fair  market  value  thereof 
could  not  be  ascertained  at  the  time  of  the  transfer, 
shall  accrue,  and  be  payable  when  the  persons  shall 
come  into  the  actual  possession  or  enjoyment  thereof. 
The  Act  of  1896  re-enacted  without  any  material 
change  the  prior  law  relating  to  the  manner  of  ap- 
praising future  and  contingent  interests,  the  provisions 
of  section  3  of  the  Act  of  1892  becoming  a  part  of  sec- 
tion 222  of  the  Act  of  1896,  and  the  provisions  of  sec- 
tion 11  of  the  Act  of  1892  becoming  a  part  of  section 
230  of  the  Act  of  1896.  The  Act  of  1896,  section  230, 
contained,  however,  a  new  provision  to  the  effect  that 
whenever  an  estate  for  life  or  for  years  can  be  divested 
by  the  act  or  omission  of  the  legatee,  it  shall  be  taxed 
as  though  there  were  no  possibility  of  such  limitation. 
It  had  been  held  in  the  Matter  of  Sloane,  19  App.  Div. 
411;  affd.,  154  N.  Y.  109,  that  the  value  of  a  life  estate 
subject  to  determination  by  an  event  happening  prior 
to  the  death  of  the  life  tenant  and  dependent  wholly 
upon  the  volition  of  the  latter  (such  as  remarriage) 
cannot  be  ascertained  until  the  estate  has  terminated, 
and  this  new  provision  was  enacted  in  view  of  this  de- 
cision by  the  Appellate  Division.     After  the  Act  of 


FUTURE    AND    LIMITED   ESTATES.  281 

1896  went  into  effect  the  Sloane  Case  was  decided  by 
the  Court  of  Appeals,  affirming  the  Appellate  Division 
decision,  and  that  court  said  that  as  this  act  did  not 
take  effect  until  June  15,  1896,  it  had  no  application  to 
this  case.  The  court  held  further  that  as  this  pro- 
vision only  relates  to  the  taxation  of  an  estate  for  life 
or  for  years,  that  can  be  divested  by  the  act  or  omis- 
sion of  the  legatee  or  devisee,  it  does  not  apply  to  an 
estate  in  remainder  that  cannot  be  so  divested. 

By  chapter  284,  Laws  1897,  in  effect  April  16th  of 
that  year,  several  important  changes  were  made  in  the 
law  taxing  remainders,  and  in  reference  to  the  tax- 
ation of  interests  passing  under  the  exercise  of  a  power 
of  appointment,  also  requiring  the  appraisal  of  cer- 
tain estates  at  their  full  value  without  regard  to  any 
contingent  incumbrance  thereon,  providing  that  in  the 
event  of  the  contingency  taking  effect  a  proportionate 
amount  of  tax  shall  be  refunded.  This  amendment 
further  provided  that  where  property  was  transferred 
subject  to  any  charge  determinable  by  the  death  of  any 
person  or  only  ascertainable  by  reference  to  death,  the 
increase  of  benefit  accruing  upon  the  extinction  of  such 
charge  shall  be  deemed  a  taxable  transfer  the  same  as 
though  such  increase  had  been  acquired  from  the 
original  grantor  or  donor.  Provision  was  further 
made  authorizing  the  trustees  of  property  devised  or 
bequeathed  to  persons  in  succession,  who  are  taxable 
at  the  same  rate,  to  pay  the  taxes  on  the  several  in- 
terests out  of  the  principal,  and  provides  for  a  com- 
position of  the  tax  where  the  persons  are  not  taxable 
at  the  same  rate. 


282  PEOCEEDINGS  BY  APPRAISERS. 

The  other  amendments  of  1897  will  be  considered 
under  the  following  headings,  namely : 

330.  a.  Taxing  Expectant  Estates  at  Their  Full  Undiminished 
Value,  Etc. 

Under  this  amendment  an  attempt  was  made  in  the 
Matter  of  Hosack,  N.  Y.  Law  Journal  of  Nov.  22, 1897, 
to  tax  at  the  full  undiminished  value  certain  remainder 
interests  which  had  been  held  as  not  presently  ascer- 
tainable, but  which  had  subsequently  become  vested  in 
possession,  but  the  surrogate  of  New  York  county  held 
that  the  amendment  of  1897  was  not  retroactive.  In- 
advertently, doubtless,  this  provision  respecting  the 
taxability  of  expectant  estates  at  their  full  undimin- 
ished value  was  omitted  from  the  amendment  of  this 
section  in  1899,  but  was  re-enacted  by  chapter  173, 
Laws  1901,  in  effect  April  1st  of  that  year,  and  chapter 
496,  Laws  1902,  in  effect  April  10th  of  that  year,  and 
contained  a  clause  evidently  showing  that  the  provision 
in  respect  to  expectant  estates  was  to  apply  to  those 
"  in  which  proceedings  for  the  determination  of  the 
tax  have  not  been  taken,  or  where  the  taxation  thereof 
has  been  held  in  abeyance. ' '  Shortly  after  this  amend- 
ment, another  remainder  vested  in  possession  in  the 
Hosack  estate  (Matter  of  Hosack,  39  Misc.  Rep.  130, 
78  N.  Y.  S.  983),  and  Surrogate  Thomas  held  in  this 
case  (following  his  decision  in  the  Matter  of  Connoly, 
38  Misc.  Rep.  533,  77  N.  Y.  S.  1113,  where  a  similar 
question  arose),  that  the  words  above  quoted,  and  re- 
ferring to  estates  where  the  taxation  thereof  has  been 
held  in  abeyance,  were  doubtless  inserted,  in  1901,  for 
the  express  purpose  of  avoiding  the  application  of  the 


FUTURE    AND   LIMITED   ESTATES.  283 

reasoning  of  his  predecessor  in  the  former  proceeding 
under  the  Act  of  1897,  and  he  held  accordingly  that  the 
law  now  in  force  was  retroactive,  and  that  it  has  ap- 
plication to  this  estate  in  1902.  The  surrogate  stated 
further  that  the  question  of  the  constitutionality  of  the 
statute,  as  so  construed,  is  an  interesting  one,  and  not 
entirely  free  from  doubt.  Citing  Matter  of  Pell,  171 
N.  Y.  48. 

The  surrogate  qualified  his  opinion  in  the  last 
Hosack  Case  (supra),  somewhat  in  the  Matter  of  Fiske, 
X.  Y.  Law  Journal  of  Feb.  18,  1903,  as  follows:  In 
this  case  the  order,  entered  January  12,  1898,  provided 
that  the  remainder  interests  dependent  upon  the  lives 
of  F.  and  R.  respectively,  were  not  then  taxable.  F., 
one  of  the  life  beneficiaries,  died  December  14,  1899, 
and  R.  died  May  7,  1902,  and  application  was  made  in 
this  proceeding  to  tax  these  remainder  interests  upon 
the  valuations  made  by  the  former  appraiser.  The 
court  held  that  while  the  statute  of  1901  was  retro- 
active in  effect,  that  the  remainder  interests  dependent 
upon  the  life  of  F.  were  no  longer  defeasible  expectant 
estates,  but  had  become  vested  through  his  death  in 
1899,  and  therefore  the  valuations  made  upon  the 
former  appraisal  were  applicable,  but  as  to  the  other 
remainder  interest,  the  Act  of  1901  applies  directly, 
since,  at  the  time  of  its  passage,  they  were  expectant 
estates  the  taxation  whereof  was  being  held  in  abey- 
ance. 

The  Appellate  Division,  however,  in  the  Matter  of 
Meyer,  83  App.  Div.  381,  82  N.  Y.  S.  329,  placed  a  dif- 
ferent construction  upon  this  provision.  In  this  case 
William  Meyer  died  in  1887  leaving  a  will  by  which  he 


284  PROCEEDINGS  BY   APPRAISERS. 

gave  to  his  brother,  Louis  Meyer,  and  to  the  members 
of  his  brother's  family,  the  income  of  $40,000  during 
his  life,  and  if  the  income  was  not  sufficient,  in  the  judg- 
ment of  the  executors,  to  secure  the  comfortable  sup- 
port of  decedent's  brother  and  his  family  residing 
with  him,  the  executors  could  apply  any  portion  of  the 
principal  to  that  purpose.  At  the  death  of  the  brother 
the  principal,  or  so  much  as  remains  unexpended,  was 
to  be  equally  divided  among  his  issue  per  stirpes. 
Louis  Meyer  was  living  at  the  time  of  the  testator's 
death  and  consequently  the  appraisal  on  the  remainder 
interests  were  postponed.  Louis  Meyer  died  May  13, 
1902,  leaving  issue,  and  prior  to  his  death  the  executors 
had  paid  to  him  a  portion  of  the  trust  fund  so  that 
there  remained  for  the  remaindermen  the  sum  of 
$30,401.  Held,  that  the  interest  of  the  remaindermen 
vested  absolutely  at  the  time  of  the  testator's  death 
and  that  the  statutes  in  force  at  that  time  determined 
the  amount  of  the  transfer  tax  which  should  be  im- 
posed thereon;  that  the  amount  on  which  the  transfer 
tax  should  be  computed  was  the  value  on  October  13, 
1887,  the  date  of  testator's  death,  of  $30,401,  payable 
on  May  13, 1902,  the  date  of  the  life  tenant's  death,  and 
that  section  230  of  chapter  908,  Laws  1896,  as  amended 
by  chapter  496,  Laws  1902,  did  not  justify  the  appraisal 
of  the  remainder  at  its  full  undiminished  value,  for  the 
reason  that  the  statute  in  question  was  not  retroactive, 
and  further,  that  if  it  was  retroactive,  it  would  be  un- 
constitutional. It  would  therefore  appear  that  the 
above  provision  would  only  apply  to  the  taxing  of  such 
expectant  estates  at  their  full  undiminished  value, 
where  the  taxation  thereof  has  been  held  in  abeyance, 


FUTURE   AND   LIMITED   ESTATES.  285 

as  may  have  vested  since  the  amendment  of  1897,  and 
prior  to  the  amendment  of  chapter  76,  Laws  1899, 
which  provides  for  the  immediate  taxation  of  all  es- 
tates in  remainder.  The  effect  of  this  decision  was  to 
overrule  the  Matter  of  Hosack  (supra),  and  Matter  of 
Connoly  (supra). 

331.  b.  Taxing  Transfers  Upon  the  Exercise  of  a  Power  of 

Appointment. 

Another  important  amendment  by  chapter  284,  Laws 
1897,  in  effect  April  16th  of  that  year,  was  the  pro- 
vision amending  section  220,  by  adding  subdivision  5 
to  said  section,  which  provides  for  the  taxation  of 
transfers  upon  the  exercise  of  a  power  of  appointment, 
and  is  fully  considered,  ante,  page  89  et  seq. 

332.  c.  Transfers  Subject  to  a  Contingent  Incumbrance. 
Occasionally  it  is  necessary  in  appraising  estates  to 

refer  to  the  provision  taxing  transfers  where  there  are 
persons  presently  entitled  to  the  beneficial  enjoyment 
or  possession  thereof,  but  which  are  subject  to  some 
contingent  incumbrance  thereon  whereby  the  estate  or 
interest  may  be  abridged  or  defeated. 

Incident. 

In  the  Matter  of  Tracy,  179  N.  Y.  501,  the  will  of  the 
decedent  gave  one  James  Rohm,  a  servant  of  the 
family,  an  annuity  of  $300,  besides  his  wages,  so  long 
as  he  remained  in  the  employ  of  decedent's  daughter. 
Held,  that  "  the  probable  duration  of  the  annuitant's 
life  should  be  ascertained  in  the  manner  pointed  out 
by  section  230,  which  is  under  the  rule,  method,  and 


2S6  PROCEEDINGS   BY    APPRAISERS. 

standard  of  mortality  and  value  employed  by  the  Su- 
perintendent of  Insurance,  *  this  fact  being- 
ascertained,  the  amount  of  the  transfer  tax  is  com- 
puted thereon  and  becomes  forthwith  payable  out  of 
the  fund  set  aside  for  creating  the  annuity.  (In  this 
case  it  happens  to  be  the  residuary  estate.) " 

333.  d.  Increase  Accruing,  When  Deemed  a  Taxable  Transfer. 
The  provision  that,  where  property  shall  be  trans- 
ferred subject  to  any  charge  determinable  by  the  death 
of  any  person,  or  at  any  period  ascertainable  only  by 
reference  to  death,  the  increase  accruing  to  any  person, 
upon  the  determination  of  such  charge,  shall  be  deemed 
a  taxable  transfer,  the  same  as  though  the  person  bene- 
ficially entitled  thereto  had  then  acquired  such  increase 
from  the  original  donor  or  grantor,  has  not  been  the 
subject  for  judicial  interpretation  by  our  courts,  and  it 
is  not  apparent  as  to  what  transfers  this  provision  was 
intended  to  be  applicable.  This  provision  would  doubt- 
less apply  where  the  testator  directed  a  fund  of  a  spe- 
cific amount  to  be  held  in  trust  by  his  executors  for 
the  purpose  of  paying  an  annuity  of  a  certain  sum  to 
A.  with  remainder  over  to  B.  with  any  accumulation, 
and  the  fund  was  sufficiently  large  to  more  than  pro- 
vide for  the  annuity.  In  that  event  the  increase  ac- 
cruing upon  the  termination  of  such  annuity  would  be 
taxable  as  a  transfer  of  such  increase  from  the  original 
donor. 

334.  Contingent  Remainders  Since  1899  are  Presently  Tax- 

able. 

The  rule  that  future  contingent  estates  are  not  tax- 
able under  the  Transfer  Tax  Act  until  they  vest  in 


FUTURE    AND   LIMITED   ESTATES.  287 

possession,  and  the  beneficial  owner  was  ascertained, 
was  changed  by  chapter  76,  Laws  1899,  amending  sec- 
tion 230  of  the  Act  of  1896,  in  effect  March  14th  of 
that  year,  which  provides  in  part  as  follows : 

When  property  is  transferred  in  trust  or  otherwise,  and 
the  rights,  interest  or  estates  of  the  transferees  are  depend- 
ent upon  contingencies  or  conditions  whereby  they  may  be 
wholly  or  in  part  created,  defeated,  extended  or  abridged,  a 
tax  shall  be  imposed  upon  said  transfer  at  the  highest  rate 
which,  on  the  happening  of  any  of  said  contingencies  or  con- 
ditions, would  be  possible  under  the  provisions  of  this  article, 
and  such  tax  so  imposed  shall  be  due  and  payable  forthwith 
by  the  executors  or  trustees  out  of  the  property  transferred : 


This  provision  was  first  passed  upon  by  the  Court  of 
Appeals,  and  declared  constitutional  in  the  Matter  of 
Vanderbilt,  172  N.  Y.  69,  reversing  same  case,  68  App. 
Div.  27,  74  N.  Y.  S.  450,  and  overruling  Matter  of  Plum, 
37  Misc.  Rep.  466,  75  N.  Y.  S.  940,  and  Matter  of 
Howell,  34  Misc.  Eep.  432,  69  N.  Y.  S.  1016.  Judge 
Haight  in  his  opinion  says:  "  It  seems  to  me  clear 
that  the  Legislature  by  this  amendment  intended  to 
change  the  law  upon  the  subject  and  to  make  the  trans- 
fer tax  upon  property  transferred  in  trust  payable 
forthwith.  The  tax  is  not  required  to  be  paid  by  the 
conditional  transferee,  for,  by  the  provisions  of  the 
statute,  it  is  to  be  paid  out  of  the  property  transferred, 
so  that  whoever  may  ultimately  take  the  property  takes 
that  which  remains  after  the  payment  of  the  tax/1 

In  the  Matter  of  Brez,  172  N.  Y.  609,  the  question 
involved  in  the  Vanderbilt  Case  (supra)  was  again  be- 
fore the  court,  and  the  court  said :    ' '  Although  the  pro- 


288  PROCEEDINGS  BY   APPRAISERS. 

visions  of  the  Transfer  Tax  Act,  as  amended  by  chap- 
ter 76,  Laws  1899,  requiring  the  tax  upon  contingent 
remainders  to  be  paid  forthwith  out  of  the  corpus  of 
the  estate  transferred,  has  been  held  to  be  constitu- 
tional *  *  *  it  seems,  bearing  in  mind  the  general 
character  of  the  tax  *  *  *  that,  if  it  is  desired  to 
make  tax  on  remainders  payable  immediately,  it  would 
be  fairer  to  the  life  tenant  to  have  the  tax  assessed  at 
the  lowest  rate  of  any  succession  provided  for  by  the 
will,  and  that,  in  case  the  remainders  eventually  vest- 
ing should  prove  taxable  at  a  higher  rate,  then  such 
increased  tax  should  be  payable  at  the  time  of  its  en- 
joyment." 

Following  the  suggestion  of  the  court  in  the  Brez 
Case,  the  practice  has  been,  where  the  possibility  of 
the  remainders  vesting  at  the  highest  rate  is  very  re- 
mote, to  assess  the  tax  at  1  per  cent,  upon  such  re- 
mainders, the  order  containing  a  proviso  that,  in  the 
event  of  the  estate  in  remainder  passing  to  those  in  the 
5-per  cent,  class  in  whole  or  in  part,  the  increased  tax 
shall  accrue  and  be  immediately  payable  at  that  time. 

335.  The  Provisions  of  the  Amendments  of  1899  (Section  230) 
Apply  Equally  to  the  Payment  of  Tax  on  Vested  as 
Well  as  Contingent  Remainders. 

The  decision  in  the  Matter  of  Vanderbilt,  172  N.  Y. 
69,  dealt  only  with  a  contingent  remainder,  and  it 
would  seem  that  a  strict  reading  of  the  provisions  of 
the  amendment  of  1899  might  refer  only  to  the  taxa- 
tion of  contingent  remainders  and  the  payment  of  the 
tax  thereon  forthwith,  from  the  property  transferred 
in  trust. 


FUTURE    AND   LIMITED   ESTATES. 


289 


However,  the  practice  has  been,  since  the  Vanderbilt 
decision,  to  appraise  the  value  of  all  life  estates,  and 
remainders,  whether  contingent  or  vested,  and  for  the 
executors  to  pay  the  tax  thereon  out  of  the  property 
held  in  trust. 

The  right  to  apply  the  provisions  of  this  amendment 
to  vested  remainders  was  first  passed  upon  by  the 
Court  of  Appeals  in  the  Matter  of  Tracy,  179  N.  Y.  501, 
where,  by  the  will  of  the  decedent,  the  entire  property, 
real  and  personal,  was  converted  into  trust  estates 
for  the  benefit  of  life  tenants  and  remaindermen,  all 
of  the  latter  being  contingent,  except  the  remainder 
to  the  Syracuse  University,  which  takes  its  estate  in 
remainder  upon  the  death  of  a  life  tenant  who  was  a 
daughter  of  decedent. 

Judge  Bartlett,  in  writing  for  the  court,  after  refer- 
ring to  the  material  portions  of  section  230,  as  amended 
by  chapter  76,  Laws  1899,  and  chapter  658,  Laws  1900, 
says :  "It  thus  appears  that  whenever  a  transfer  of 
property  is  made,  upon  which  there  is,  or  by  any  con- 
tingency there  may  be,  a  tax  imposed,  the  property  is 
to  be  properly  appraised  at  its  clear  market  value,  and 
the  transfer  tax  is  due  and  payable  forthwith,  out  of 
the  property  transferred." 

The  court  then  says,  after  referring  to  the  Matter 
of  Vanderbilt,  and  the  portion  of  Judge  Haight's  opin- 
ion hereinbefore  quoted,  at  page  287 : 

"  As    our    decision    in    the    Matter    of    Vanderbilt 
(supra)  dealt  only  with  a  contingent  remainder,  this 
case,  technically  speaking,  is  not  strictly  in  point,  but 
19 


200  PROCEEDINGS  BY   APPRAISERS. 

the  principle  announced  therein  is  necessarily  involved 
in  life  estates  created  by  trusts. ' ' 

"  In  the  case  at  bar  it  is  the  duty  of  the  executors 
and  trustees  to  ascertain  the  value  of  the  respective 
life  estates  and  estates  in  remainder  in  the  manner 
pointed  out  by  section  230 ;  and  having  done  this,  they 
should  compute  the  transfer  tax  and  pay  the  same 
forthwith  out  of  the  property  transferred.  The  result 
is  that  the  life  tenant  loses,  during  the  continuance  of 
the  estate,  the  interest  upon  the  corpus  of  the  trust  so 
paid  out,  and  eventually  the  remainderman  receives 
his  estate  diminished  by  the  amount  of  said  payment. 
Whether  this  mode  of  taxation  works  out  exact  justice 
as  between  the  life  tenant  and  the  remaindermen  is  a 
question  with  which  the  court  is  not  concerned. 

"As  we  read  the  statute,  the  legislative  intent  is 
clear  that  the  transfer  tax  shall  be  paid  out  of  the 
corpus  of  the  trust  estates,  and  not  out  of  the  income. 
*  *  *  Also  that  the  transfer  taxes  imposed  upon 
the  estates  for  life  and  in  remainder  in  the  various 
trusts  carved  out  of  the  residuary  estates,  are  payable 
from  the  principal  of  said  trusts  respectively." 

336.  When  Contingent  or  Vested  Remainder  not  Presently 
Taxable. 

The  courts  have  held,  however,  in  two  instances,  that, 
even  under  the  provisions  of  chapter  76,  Laws  1899,  it 
is  not  proper  to  immediately  appraise  and  tax  all  con- 
tingent remainders. 


FUTURE   AND   LIMITED   ESTATES.  291 

337.  a.  Where  Life  Tenant  Can  Use  a  Part  or  All  of  the 
Principal. 

Where  a  life  estate  is  created,  and  the  executors  or 
trustees  are  authorized  and  directed  to  use  any  part 
of  the  corpus  of  the  estate  for  the  benefit,  support,  and 
maintenance  of  the  life  tenant  or  beneficiary,  or  where 
the  income  is  insufficient  to  provide  for  a  certain  an- 
nuity the  executors  or  trustees  are  to  make  up  the 
deficiency  from  the  corpus  of  the  fund  applicable  to 
that  purpose,  that  the  appraisal  of  the  estates  in  re- 
mainders must  be  held  in  abeyance  until  the  termina- 
tion of  the  life  estate,  or  other  prior  estate,  and  that 
the  tax  does  not  accrue  upon  such  remainders  until  the 
happening  of  that  event. 

In  the  Matter  of  Babcock,  37  Misc.  Rep.  445,  75  N.  Y. 
S.  926;  unanimously  affd.,  81  App.  Div.  645,  81  N.  Y. 
S.  1117,  on  the  opinion  below,  the  testatrix,  after 
making  certain  specific  bequests,  provided  as  follows : 

Third.  I  give,  devise  and  bequeath  to  my  brother 
*  *  *  the  use  during  his  life  of  all  the  personal  property 
of  which  I  may  die  seized,  and  if  the  use  thereof  is  not  suf- 
ficient to  suitably  clothe,  care  for  and  maintain  him,  then  he 
is  to  have  and  use  as  much  of  the  principal  thereof  as  is 
necessary. 

Fourth.  After  the  decease  of  my  brother  *  *  *  if 
there  remains  unused  by  him  any  of  the  personal  property,  I 
give,  devise  and  bequeath  the  same  as  follows :  naming  cer- 
tain nephews,  nieces  and  strangers. 

The  court  says  section  222  of  the  Taxable  Transfer 
Law  provides  that  "  All  taxes  imposed  by  this  article 
shall  be  due  and  payable  at  the  time  of  the  transfer; 


292  PROCEEDINGS  BY  APPRAISERS. 

provided,  however,  that  taxes  upon  the  transfer  of  any 
estate,  property,  or  interest  therein  limited,  condi- 
tioned, dependent,  or  determinable  upon  the  happen- 
ing of  any  contingency  or  future  event  by  reason  of 
which  the  fair  market  value  thereof  cannot  be  ascer- 
tained at  the  time  of  the  transfer,  as  herein  provided, 
shall  accrue  and  be  due  and  payable  when  the  persons 
or  corporations  beneficially  entitled  thereto  shall  come 
into  actual  possession  or  enjoyment  thereof,"  and  that 
there  is  nothing  in  the  amendment  of  section  230  by 
chapter  76,  Laws  1899,  indicating  an  intention  to  repeal 
or  limit  section  222  respecting  the  appraisal  of  this 
class  of  conditional  transfers,  as  the  section  as 
amended  contains  a  clause  indicating  that  the  Legis- 
lature did  not  expect  all  taxable  transfers  could  be 
appraised  immediately  upon  the  transfer,  to  wit: 
"  Whenever  a  transfer  of  property  is  made,  upon 
which  there  is,  or  in  any  contingency  there  may  be  a 
tax  imposed,  such  property  shall  be  appraised  at  its 
clear  market  value  immediately  upon  such  transfer, 
or  as  soon  thereafter  as  practicable,"*  and  that  this 
provision  clearly  contemplates  that  there  may  be  cases 
where  it  would  be  impracticable  to  appraise  the  prop- 
erty immediately  upon  the  transfer.  The  court  ac- 
cordingly held  that  the  time  for  appraising  and  assess- 
ing the  tax  upon  the  remainder  interests  created  by 
this  will  must  therefore  be  postponed  until  such  time 
as  the  clear  market  value  can  be  ascertained  and  deter- 
mined. 

*  This  clause  was  omitted  from  the  Transfer  Tax  Law  by  chapter 
368,  Laws  1905,  in  effect  June  1st  of  that  year,  and  it  is  possible  that 
the  rule  established  by  this  decision  may  thereafter  be  changed. 


FUTURE    AND   LIMITED   ESTATES. 


29: 


338.  b.  Where  Life  Tenant  Can  Exercise  a  Power  of  Appoint- 
ment Over  the  Fund. 
Where  the  life  beneficiary  is  given  a  power  of  ap- 
pointment over  the  fund  held  in  trust  for  his  benefit, 
the  appraisal  and  taxation  of  the  remainder  estate  to 
which  such  power  relates  must  be  postponed  until  the 
exercise  thereof,  or  failure  to  exercise  such  power,  by 
the  donee  thereof,  has  happened. 

In  the  Matter  of  Howe,  86  App.  Div.  286,  83  N.  Y.  S. 
825,  the  testatrix  bequeathed  certain  property  to  a 
trustee  to  hold  the  same  for  the  life  of  a  certain  bene- 
ficiary, and  pay  the  income  therefrom  to  such  bene- 
ficiary for  his  individual  use  and  the  use  of  his  family. 
Upon  the  death  of  the  life  beneficiary  the  trustee  was 
directed  to  transfer  the  trust  fund  to  such  persons  as 
the  life  beneficiary  should  direct  in  his  will.    ^  The 
court  held  that  the  provision  of  subdivision  5  of  sec- 
tion 220,  relating  to  transfers  upon  the  exercise  of  a 
power  of  appointment,  had  not  been  repealed  by  im- 
plication by  the  amendment  of  section  230  of  chapter 
76,  Laws  1899,  taxing  immediately  all  contingent  re- 
mainders, and  that,  under  the  provisions  of  subdivision 
5  of  section  220  aforesaid,  it  is  the  exercise  of  the 
power  and  not  the  creation  of  the  power  which  effects 
the  transfer  which  the  statute  makes  taxable,  and  that 
the  remainder  was  therefore  not  taxable  until  the  time 
arrived  for  the  exercise  of  the  testamentary  power  of 
appointment    conferred    upon    the    life   beneficiaries. 
(Overruling  Matter  of  Le  Brim,  39  Misc.  Rep.  516,  80 
N.  Y.  S.  486) ;  affd.,  176  N.  Y.  570. 

In  the  Matter  of  Clarke,  39  Misc.  Rep.  73,  78  N.  Y.  S. 


294  PROCEEDINGS  BY  APPRAISERS. 

869,  it  was  held  that  a  remainder  was  not  presently 
taxable  where  it  is  limited  to  children  of  a  life  tenant, 
or  her  appointees  by  will,  and  she  is  not  shown  to  have 
any  children,  as,  in  such  case,  no  transfer,  defeasible 
or  otherwise,  of  the  remainder  has  yet  been  made. 

339.  Words  —  Not  Enlarging  a  Life  Estate. 

A  devise  and  bequest  by  a  testator  of  all  ' '  the  rest, 
residue,  and  remainder  "  of  his  estate,  real  and  per- 
sonal, to  his  wife,  "  and  after  her  death  I  give  and  be- 
queath the  remainder  thereof  as  follows  —  ' '  affords 
no  basis  for  the  contention  that  the  words  "  the  re- 
mainder thereof  ' '  by  implication  give  the  wife  a  right 
to  use  the  principal,  and  the  interests  of  the  remainder- 
men are  presently  determinable  and  subject  to  transfer 
tax.  Matter  of  Eunice,  36  Misc.  Rep.  607,  73  N.  Y.  S. 
1120. 

340.  Discretionary    Power    to   Beneficiary   to   Use    Principal 

Creates  a  Voidable  Trust. 

A  trust  accompanied  by  a  discretionary  power  to  the 
life  beneficiary  of  the  income,  to  use  such  part  of  the 
principal  as  she  may  demand  or  need  for  her  own  use 
or  that  of  her  children,  gives  her  the  absolute  owner- 
ship of  the  principal,  if  she  so  elects  and  makes  the 
trust  voidable.  Solley  v.  Westcott,  43  Misc.  Rep.  188, 
88  N.  Y.  S.  297. 

341.  Annuities,  Value  of,  How  Ascertained. 

The  value  of  an  annuity  should  be  ascertained  by  the 
rule  of  mortality  employed  by  the  Superintendent  of 
Insurance  in  ascertaining  the  value  of  policies  of  life 
insurance  and  annuities   (§   230),  and  on  the  value 


FUTURE   AND   LIMITED   ESTATES. 


295 


so  determined  the  transfer  tax  becomes  payable  forth- 
with out  of  the  principal  set  apart  for  creating  the  an- 
nuity.    Matter  of  Tracy,  179  N.  Y.  501. 

342.  Id.  —  Payment  of  Tax  Upon. 

Where  a  fund  out  of  which  the  transfer  tax  is  to  be 
paid  is  the  residuary  estate  of  the  testator,  the  tax 
paid  on  the  annuity  is  to  be  returned  to  the  residuary 
estate  by  deducting  from  each  annual  payment  of  the 
annuity  a  proportionate  part  of  such  tax,  to  be  ascer- 
tained by  dividing  the  amount  of  the  tax  paid  by  the 
number  of  years  the  annuity  will  probably  continue. 
Matter  of  Tracy,  179  N.  Y.  501. 
343    id.  _  Tax  on  Fund  Subject  to  Annuities. 

Where  decedent's  widow  is  given  a  life  estate  in  his 
personal  property,  subject  to  an  annuity  to  a  sister 
for  life,  and  the  payment  of  a  certain  sum  daily  to  his 
brother  for  life,  in  calculating  the  present  value  of 
the  widow's  life  estate  it  is  proper  to  deduct  from 
the  net  value  of  the  personal  estate  the  present  value 
of  the  annuities  instead  of  deducting  therefrom  the 
actual  amount  set  aside  as  necessary  to  produce  the 
annuities.  Matter  of  Maresi,  74  App.  Div.  76,  77  N.  Y. 
S.  76. 

344.  Id.  —  When  Cost  of  Annuity  Determines   Its   Value,  as 
Affecting  the  Residuary  Estate. 

In  the  Matter  of  Hutchinson,  N.  Y.  Law  Journal  of 
Jan.  13,  1905,  Surrogate  Thomas  held,  that  where  the 
decedent  requested  his  executors  "  to  arrange  for  cer- 
tain annuities  "through  specified  insurance  companies, 


296  PROCEEDINGS  BY  APPRAISERS. 

the  cost  of  such  annuities  should  be  deducted  from  the 
residuary  estate,  and  not  their  present  value  as  shown 
by  the  Superintendent  of  Insurance,  it  appearing  that 
the  actual  cost  was  upward  of  $19,000  more  than  the 
appraised  present  value.  Distinguishing  Matter  of 
Maresi,  74  App.  Div.  76,  77  N.  Y.  S.  76,  and  Matter  of 
Tracy,  179  N.  Y.  501,  it  appearing  in  those  cases  that 
the  annuities  were  to  be  raised  from  funds  set  apart 
for  such  purpose,  which  funds  would  revert  to  the  re- 
siduary estate  upon  the  death  of  the  annuitants.  The 
State  Comptroller  appealed  to  the  Appellate  Division 
of  the  First  department  from  the  order  of  the  surro- 
gate, and  on  June  23,  1905,  that  court  handed  down  a 
decision  affirming  the  order  of  the  surrogate.  Mr. 
Justice  Ingraham  states  in  the  opinion,  that  by  the 
provisions  of  section  230  of  the  Transfer  Tax  Law, 
it  is  the  value  of  the  annuity  to  the  annuitant,  or  the 
value  of  the  interest  to  the  person  to  whom  such  inter- 
est is  given  that  is  taxable,  and  which  this  section  regu- 
lates; and,  therefore,  it  is  the  value  of  these  annui- 
ties to  the  annuitants  which  the  statute  contemplated 
should  be  determined  by  the  method  described;  that 
the  executors  followed  the  direction  in  the  will  and 
purchased  the  annuities  from  the  two  life  insurance 
companies  designated  by  the  testator,  to  obtain  which 
they  were  required  to  pay  a  certain  sum  of  money,  and 
having  elected  that  these  annuities  should  be  charge- 
able upon  the  property  in  this  State,  the  question  upon 
the  appeal  is,  "  What  is  the  value  of  the  property 
transferred  by  the  will  to  the  Tulane  University 
(the  residuary  legatee)  which  is  subject  to  taxation? 
*     *     *     it  would  seem  that  the  tax  upon  that  trans- 


FUTURE   AND   LIMITED   ESTATES.  297 

fer  is  to  be  based  upon  the  amount  that  the  residuary 
legatee  will  actually  receive,  and  not  upon  an  assumed 
value  of  an  annuity  to  somebody  else  in  which  the  re- 
siduary legatee  has  no  possible  interest."  "  * 
It  follows  therefore  that  the  surrogate  was  right  in, 
*  *  *  directing  a  reappraisement  which  should  fix 
the  value  of  the  interest  of  the  residuary  legatee  in  the 
amount  that  it  will  actually  receive,  by  virtue  of  the 
transfer  of  the  property  of  the  decedent  within  this 
State."    Matter  of  Hutchinson,  105  App.  Div. 

345.  Tax  on  Remainders  in  Trust  Estates  are  Presently  Pay- 
able. 

Where  testator  devised  his  residuary  estate  in  trust 
for  the  benefit  of  his  wife  and  daughter  during  their 
lifetimes,  with  remainder  to  his  next  of  kin  and  heirs- 
at-law,  or  to  the  lawful  issue  of  the  daughter,  —  held, 
that  the  transfer  tax  to  which  the  estate  in  remainder 
was  subject  was  presently  payable;  that  the  Legisla- 
ture, by  the  amendment  to  section  230  (chap.  76,  L. 
1899)  intended  to  change  the  law  upon  the  subject,  and 
to  make  the  transfer  tax  upon  property  transferred  in 
trust  payable  forthwith  out  of  the  property  trans- 
ferred. Matter  of  Huber,  86  App.  Div.  458-461,  83 
N.  Y.  S.  769.  Citing  Matter  of  Vanderbilt,  172  N.  Y. 
69;  Matter  of  Brez,  172  N.  Y.  609. 

In  the  Huber  Case  (supra)  the  decedent  stated  in 
his  will:  "  It  is  my  intention  by  this  my  last  will  and 
testament  to  dispose  of  all  the  property  which  I  may 
now  possess  or  may  hereafter  acquire,  and  more  par- 
ticularly all  my  right,  title,  and  interest  in  and  to  all 
property,  both  real  and  personal,  which  I  may  have  or 


298  PROCEEDINGS  BY  APPRAISERS. 

hereafter  acquire  in  the  estate  of  my  deceased  father, 
which  interest  is  now  subject  to  the  life  estate  of  my 
mother,"  and  the  court  held  that  the  interest  of  Otto 
Huber,  Jr.,  in  his  father's  estate,  dependent  upon  the 
life  estate  of  his  mother,  and  which  he  (Otto  Huber, 
Jr.)  disposed  of  by  the  terms  of  his  will,  was  presently 
taxable.    See  also  Matter  of  Clinch,  180  N.  Y.  300. 

It  was  also  held  in  the  Matter  of  Tracy,  179  N.  Y.  501, 
that  the  transfer  tax  under  chapter  76,  Laws  1899,  and 
imposed  upon  trusts  created  by  will,  are  to  be  paid 
from  the  principal  of  such  trusts  and  life  estates.  To 
the  same  effect,  see  Matter  of  Hoyt,  44  Misc.  Rep.  76, 
89  N.  Y.  S.  744. 

It  would  seem  that  the  foregoing  decisions  would 
overrule  the  decision  in  the  Matter  of  Hoyt,  37  Misc. 
Rep.  720,  76  N.  Y.  S.  504,  as  it  appears  from  the  ap- 
praiser's report  that  the  decedent,  Charles  P.  Daly, 
died  September  19,  1899,  at  which  time  chapter  76, 
Laws  1899,  was  in  force. 

346.  The  Transfer  Tax  Law  Does  not  Apply  to  Remainders 
and  Reversions  Created  Before  it  Went  into  Effect. 

Remainders  and  reversions  actually  created  by  deed 
or  by  will  before  the  Collateral  Inheritance  or  Transfer 
Tax  Law  was  passed,  although  vesting  in  possession 
thereafter,  are  not  taxable.  Matter  of  Seaman,  147 
N.  Y.  69 ;  Matter  of  Langdon,  153  N.  Y.  6 ;  Matter  of 
Pell,  171  N.  Y.  48;  Matter  of  Craig,  97  App.  Div.  289, 
89  N.  Y.  S.  971;  affd.,  181  N.  Y.  Mem.  49;  Matter  of 
Hitchins,  43  Misc.  Rep.  485,  89  N.  Y.  S.  472;  affd.,  181 
N.  Y.  Mem.  51.     No  opinion. 


FUTURE   AND   LIMITED   ESTATES.  299 

347.  The  Act  of  1885  —  Remainder   Created  by  Deed. 
Where  property  was  deeded  in  1882  to  trustees  in 

trust  to  pay  income  to  decedent  for  life,  and  on  her 
death  to  convert  it  into  money  and  distribute  it  to 
nephews  and  nieces,  and  where  the  death  of  decedent 
occurred  before  the  Act  of  1885  went  into  effect,  held, 
that  the  legacies  to  the  nephews  and  nieces  were  not 
taxable.  Matter  of  Hendricks,  18  N.  Y.  St.  R.  989,  3 
N.  Y.  S.  281.  See  also  Matter  of  Craig,  97  App.  Div. 
289,  89  N.  Y.  S.  971 ;  affd.,  181  N.  Y.  Mem.  49,  on  opin- 
ion below,  where  grantor  died  in  1901. 

348.  Defeasible   Interests,    Transfer  of  —  Refers  to  Testator's 

Death. 
Where  a  vested  though  defeasible  interest  in  re- 
mainder passes  under  a  will  to  the  remainderman  on 
the  testator's  death,  though  the  possession  does  not 
pass  until  the  death  of  the  life  tenant,  the  transfer  or 
succession  is  referred  to  the  time  of  the  testator's 
death,  and  if  that  occurred  prior  to  the  enactment  of 
the  law  taxing  transfers  of  property  the  remainder  is 
not  taxable.  Matter  of  Hitchins,  43  Misc.  Rep.  485, 
89  N.  Y.  S.  472;  affd.  by  the  Appellate  Division,  89 
X.  Y.  S.  472,  and  by  Court  of  Appeals,  181  N.  Y.  Mem. 
51. 

349.  Decision  Prior  to  Chapter  76,  Laws  1899  — When  Con- 
tingent Interests  Taxable  Under  Act  of  1885. 

The  statute  does  not  contemplate  only  those  cases 
where  the  interests  created  are  capable  of  valuation 
at  the  death  of  the  testator.  Contingent  interests  may 
be  taxed  when  they  vest  in  possession  and  their  value 
<ni)  be  ascertained.     Matter  of  Stewart,  131  N.  Y.  274. 


300  PROCEEDINGS  BY  APPRAISERS. 

350.  Contingent  and  Expectant  Estates  —  Act  of  1892. 
Can  only  be  taxed  when  they  become  fixed  and  actual. 

Matter  of  Hoffman,  143  N.  Y.  327;  Matter  of  Westcott, 

II  Misc.  Rep.  589,  33  N.  Y.  S.  426;  Matter  of  Roosevelt, 
143  N.  Y.  120;  Matter  of  Le  Fever,  5  Dem.  184;  Matter 
of  Leavitt,  4  N.  Y.  S.  179;  Matter  of  Clark,  5  K.  Y.  S. 
199.    Decisicns  prior  to  1899. 

351.  Vested  Interests,  When  Taxable. 

A  vested  remainder  subject  to  a  life  estate,  where  it 
is  capable  of  being  ascertained,  is  subject  to  tax  at  the 
testator's  death.  Matter  of  Vinot,  26  N.  Y.  St.  R.  610, 
7  N.  Y.  S.  517. 

352.  Contingent  Interests,  When  Taxable. 

Contingent  interests  not  being  presently  subject  to 
appraisal  are  not  presently  taxable.     Matter  of  Cagey, 

III  N.  Y.  343.     Decision  under  Act  of  1885. 

A  remainder  dependent  upon  two  successive  life  es- 
tates held  not  presently  taxable.  Matter  of  Westcott, 
11  Misc.  Rep.  589,  33  N.  Y.  S.  426. 

Such  interests  are  taxable  when  they  vest  in  posses- 
sion and  their  value  can  then  be  ascertained.  Matter 
of  Stewart,  131  N.  Y.  274. 

Remainders  under  a  will  by  which  the  testator  cre- 
ated four  certain  trusts,  each  to  continue  for  the  life 
of  the  respective  beneficiary,  with  remainder  over  to 
nephews  and  nieces,  are  not  taxable  until  the  termina- 
tion of  the  respective  trusts.  Matter  of  Curtis,  142 
N.  Y.  219. 


FUTURE    AND    LIMITED   ESTATES.  301 

Life  annuities  dependent  upon  survivorship  are  not 
subject  to  taxation  until  they  vest  in  possession  by  the 
termination  of  the  previous  life  estate  upon  which  they 
are  contingent.     Matter  of  Roosevelt,  143  N.  Y.  120. 

So  long  as  a  contingency  continues  which  effects  the 
value  of  a  vested  remainder  it  will  prevent  the  remain- 
der from  becoming  taxable.  Matter  of  Roosevelt,  143 
X.  Y.  120. 

Contingent  remainders  are  not  to  be  appraised  until 
the  happening  of  the  contingency  or  the  defeating  con- 
tingency has  been  rendered  impossible.  Matter  of 
Clark,  22  N.  Y.  St.  R.  354,  5  N.  Y.  S.  199;  Matter  of 
Wallace,  18  N.  Y.  St.  R.  387,  4  X.  Y.  S.  465. 

The  estate  of  a  tenant  for  life  is  not  liable  to  pay  the 
transfer  tax  on  remainders  created  by  the  will  of  which 
the  life  tenant  is  the  executrix.  Matter  of  McMahon, 
28  Misc.  Rep.  697,  60  X.  Y.  S.  64. 

When  property  is  conveyed  to  a  trust  company  to 
hold  and  manage  during  the  life  of  the  grantor,  to 
pay  the  income  thereof  to  him,  and  to  transfer  the  same 
after  his  death  to  the  persons  named  in  his  will,  or 
to  his  next  of  kin,  a  naked  revocable  trust  is  created, 
and  the  property  is  to  be  taxed  as  passing  by  the  will. 
Matter  of  Ogsburtj,  7  App.  Div.  71,  39  N.  Y.  S.  978. 

Rights  of  residuary  legatees  sure  to  come  into  the 
immediate  possession  of  the  estate,  if  they  survive  the 
trust  period,  and  are  living  at  the  termination  of  the 
previous  estate  created  for  their  benefit,  and  which 
they  can  dispose  of  by  will,  are  taxable.  Matter  of 
Sherman,  30  Misc.  Rep.  547,  63  N.  Y.  S.  957. 


CHAPTER  XV. 


Proceedings  by  Appraisers  —  Deductions. 


353.  The  general  subject. 

354.  Deductions  generally ;  commis- 

sions of  executors  and  ad- 
ministrators. 

355.  The  commissions  of  temporary 

administrators. 

356.  Commissions  of  foreign  execu- 

tors. 

357.  Executor's      commissions      as 

trustee. 

358.  Counsel  fees. 

359.  Disbursements    for   benefit   of 

estate. 

360.  Commissions  of  trustee. 

361.  Deduction    of    note    in    litiga- 

tion. 

362.  Estimated  expense  of  adminis- 

tration. 

363.  Taxes. 
264.  Taxes     under     Greater     New 

York  Charter. 

365.  Taxes    assessed    in    decedent's 

lifetime. 

366.  Id.;  when  assessment-roll  com- 

pleted. 

367.  Id. ;  due  at  decedent's  death. 

368.  Claims  against  the  decedent's 

estate. 

369.  Doubtful  and  uncertain  claims. 

370.  Disbursements  of  the  executor 

or  administrator. 

371.  Funeral  expenses. 

372.  Cost  of  burial  plot. 

373.  A  judgment,  liability  to  pay 

which  is  secured  by  an  in- 
demnity bond  and  mortgage, 
is  not  a  proper  deduction. 

374.  Debts  due  New  York  creditors 

by  nonresident  decedent. 


(§  230,  Tax  Law.) 

375.  Doubtful  claims. 

376.  Value  of  particular  estate. 

377.  Present  value  of  an  annuity. 

378.  When  cost  of  annuity  a  proper 
deduction. 

379.  Apportionment  of  debts,  etc., 
between  exempt  and  nonex- 
empt  personal  property. 

380.  Widow  entitled  to  money 
equivalent  in  lieu  of  neces- 
sary provisions  and  fuel  for 
sixty  days. 

381.  Claims,  etc.,  not  allowed;  ex- 
pense of  unnecessary  action. 

382.  When  debt  not  allowed. 

383.  When  commission  not  to  be 
deducted. 

384.  Counsel  fees;  when  not  al- 
lowed. 

385.  Sum  paid  for  withdrawal  of 
objections  to  probate;  not 
allowed. 

386.  The  amount  of  the  individual 
bond  of  a  decedent  accom- 
panying a  mortgage  exe- 
cuted by  both  decedent  and 
his  wife  upon  real  estate 
owned  by  the  wife  will  not 
be  deducted  from  the  de- 
cedent's personal  estate  as 
a  debt  owing  by  him. 

387.  Articles  enumerated  in  subd. 
3  of  sec.  2713  of  the  Code; 
not  entitled  to  money  allow- 
ance therefor. 

388.  Legacy  to  a  creditor;  not  to 
be  deducted. 

389.  When  debts  owing  by  non- 
residents not  allowed. 


[302] 


DEDUCTIONS. 


303 


390.  Mortgage  debts  not  allowed. 

391.  Tax  paid  in  another  State. 

392.  Taxes     under     Greater     New 

York  Charter;  when  not  de- 
ductible. 


393.  Repairs  to  real  estate,  not  al- 

lowed. 

394.  Tax  directed  to  be  paid  as  an 

administration  expense. 

395.  When    debts    cannot    be    de- 

ducted after  appraisal. 


353.  The  General  Subject. 

There  is  no  express  provision  of  the  statute  author- 
izing the  appraiser  to  make  any  deductions  on  account 
of  debts,  testamentary  expenses,  commissions,  or  gen- 
eral administration  expenses,  and  the  earlier  cases  held 
that  the  duty  of  the  appraiser  was  simply  to  report  the 
value  of  the  estate  without  considering  or  allowing 
claims  against  the  estate.  In  the  Matter  of  Swift,  137 
N.  Y.  at  page  87,  the  Court  of  Appeals  says,  under  Act 
of  1885 :  ' '  Manifestly  under  the  law,  that  which  is  to 
be  reported  by  the  appraiser  for  the  purpose  of  the 
tax  is  the  value  of  the  interest  passing  to  the  legatee 
under  the  will,  without  any  deductions  for  any  purpose 
or  under  any  testamentary  direction,"  and  in  the  Mat- 
ter of  Ludlow,  4  Misc.  Rep.  594,  25  N.  Y.  S.  989,  the 
surrogate  of  Westchester  county  held  that  the  ap- 
praiser exceeded  his  power  under  the  statute  by  de- 
ducting funeral  expenses,  expenses  of  administration, 
and  commissions.  The  same  surrogate  reaffirmed  this 
position  in  the  Matter  of  Millward,  6  Misc.  Rep.  425, 
27  N.  Y.  S.  286,  the  effect  of  which  was  to  hold  that 
the  legatees  took  the  estate  cum  onere,  as  the  tax  is  not 
placed  upon  what  the  legatees  may  get,  but  upon  the 
value  of  the  estate  transferred  at  the  death  of  the 
testator. 

Section  6  of  the  old  law  (now  section  225),  which 


304  PROCEEDINGS  BY  APPRAISERS. 

provides  for  a  refund  in  certain  cases  where  debts 
shall  be  proven  against  the  estate,  after  the  payment 
of  any  legacy  or  share  upon  which  the  tax  has  been 
paid,  was  construed  by  the  surrogate  as  giving  the 
s  arrogate,  but  not  the  appraiser,  authority  to  deter- 
mine the  amount  of  debts  to  be  deducted.  But  Surro- 
gate Silkman,  in  a  later  decision  (Matter  of  Purdy,  24 
Misc.  Rep.  301,  53  N.  Y.  S.  735),  refused  to  follow  the 
procedure  of  his  predecessor,  and  held  that  the  ap- 
praiser himself,  in  ascertaining  the  fair  market  value 
of  the  property  subject  to  tax,  "  must  deduct  from  the 
personal  property  the  debts  of  decedent,  the  expenses 
of  administration,  and  the  commissions  of  the  executor 
or  administrator."  It  was  generally  conceded,  how- 
ever, that  the  statute  contemplated  that  the  transfer 
tax  was  not  to  be  imposed  upon  the  given  estate,  but 
only  upon  the  interest  which  will  ultimately  pass  to  the 
transferees,  and  that  this  view  necessarily  required  a 
deduction  of  all  debts  and  expenses  of  administration 
before  the  correct  amount  of  the  transfer  tax  could  be 
ascertained,  and  in  New  York  county  and  other  coun- 
ties it  was  generally  the  custom  for  the  appraiser  to 
take  evidence  as  to  the  debts,  testamentary  expenses, 
and  commissions,  and  to  include  these  items  as  proper 
deductions  in  his  report.  This  question,  however,  was 
first  passed  upon  by  the  Court  of  Appeals  in  the  Matter 
of  Westum,  152  N.  Y.  93,  the  court  saying:  "  There 
can  be  no  doubt,  we  think,  that  in  ascertaining  the 
value  of  the  estate  of  the  decedent  and  the  value  of 
the  taxable  interests,  debts  owing  by  him  are  to  be 


DEDUCTIONS.  305 

deducted.  They  are  charges  which  qualify  the  estate 
and  are  first  to  be  paid  before  there  can  be  any  distri- 
bution of  the  personal  estate  to  legatees  or  next  of  kin. 
*  *  *  Whether  the  transfer  is  by  will  or  by  the 
operation  of  law,  the  real  interest  passing  is  what  re- 
mains after  payment  of  debts  and  other  charges." 

354.  Deductions   Generally  —  Commissions  of  Executors  and 

Administrators. 

The  commissions  of  executors  or  administrators  are 
deductible,  as  they  are  an  expense  provided  by  statute 
and  chargeable  against  the  estate  and  not  the  bene- 
ficiaries.    Matter  of  Westurn,  152  N.  Y.  93. 

355.  The  Commissions  of  Temporary  Administrators. 

The  commissions  of  a  temporary  administrator  ap- 
pointed pending  a  will  contest,  and  also  the  commis- 
sions of  a  trustee  appointed  under  a  will  to  pay  over 
the  income  of  a  trust  to  the  life  beneficiary,  are  de- 
ductible.    Matter  of  Gihon,  169  N.  Y.  443. 

In  the  Gihon  Case  (supra)  the  court  stated  that, 
while  there  was  a  clear  distinction  between  the  com- 
missions of  an  executor,  whose  appointment  is  essen- 
tial for  the  administration  of  the  estate,  and  those  of 
a  trustee,  who  only  protects  the  property  of  the  cestui 
que  trust,  yet  it  felt  bound  to  hold  the  trustees'  com- 
missions deductible  in  view  of  the  provision  of  section 
227  of  the  Transfer  Tax  Law,  which  taxes  legacies  to 
trustees  in  excess  of  commission,  which  implies  that 
the  commissions  themselves  should  be  deducted. 
20 


306  PROCEEDINGS  BY  APPRAISERS. 

356.  Commissions  of  Foreign  Executors. 

The  connnissions  of  foreign  executors  are  deductible 
upon  the  appraisal  of  a  nonresident's  estate,  based 
upon  the  relative  property  within  this  State,  at  the 
rate  allowed  resident  executors,  unless  proof  is  made 
of  a  different  rate  allowed  by  the  foreign  State.  Matter 
of  Kennedy,  20  Misc.  Rep.  531,  46  N.  Y.  S.  906. 

357.  Executor's  Commissions  as  Trustee. 

'  An  executor's  commission  as  trustee  should  be  de- 
ducted. Matter  of  Silliman,  79  App.  Div.  98,  80  N.  Y. 
S.  336,  revg.  38  Misc.  Rep.  226,  77  N.  Y.  S.  267;  affd., 
175  N.  Y.,  no  opinion. 

358.  Counsel  Fees. 

Reasonable  counsel  fees  paid  by  the  representative 
of  the  estate  to  the  attorney  employed  is  a  proper  de- 
duction, and  the  expenses  of  litigation  in  upholding  a 
will  or  having  it  construed  are  also  proper  deductions. 
Matter  of  Maresi,  74  App.  Div.  76,  77  N.  Y.  S.  76. 

359.  Disbursements  for  Benefit  of  Estate. 

Disbursements  honestly  made  by  an  executor  or  ad- 
ministrator in  necessary  litigation  for  the  benefit  of 
the  estate  are  proper  deductions.  Matter  of  Thomas, 
39  Misc.  Rep.  223,  79  N.  Y.  S.  571. 

360.  Commissions  of  Trustee. 

The  statutory  commissions  of  a  trustee  appointed 
by  the  will  to  pay  over  income  to  a  life  beneficiary 
should  be  deducted.     Matter  of  Gihon,  169  N.  Y.  443. 


DEDUCTIONS. 


307 


361.  Deduction  of  Note  in  Litigation. 

A  note  on  which  suit  has  been  commenced  by  the 
administrator,  and  is  pending  when  the  appraisal  for 
transfer  tax  is  made,  should  be  deducted  from  the 
valuation,  and  reserved  for  future  appraisement  in 
case  the  administrator  succeeds  in  collecting  it.  Matter 
of  Westurn,  152  N.  Y.  93. 

362.  Estimated  Expenses  of  Administration. 

Where  the  expenses  of  administration  are  uncertain, 
they  may  be  estimated,  and  such  estimate  deducted. 
Matter  of  Gould,  19  App.  Div.  352,  46  N.  Y.  S.  506,  156 
N.  Y.  423;  Matter  of  Westurn,  152  N.  Y.  93. 

363.  Taxes. 

Assessments  so  far  completed  that  the  name  of  the 
person  named  as  owner  cannot  be  changed  or  altered 
by  the  assessment  officers  before  the  death  of  such 
person  shall  be  payable  from  his  estate  in  due  course 
of  administration.  Matter  of  Babcock,  115  N.  Y.  450. 
See  also  Rundell  v.  Lakeij,  40  N.  Y.  513-517,  where  the 
question  was  raised  between  grantor  and  grantees. 

364.  Taxes  Under  Greater  New  York  Charter.* 

Where  decedent  dies  June  17,  1902,  after  the  record 
of  the  assessed  valuation  and  the  time  for  application 

*  Provisions  of  New  York  Charter  Relative  to  Taxes. 

Section  889.     First  Tuesday  of  September,  assessment  commenced. 

Section  892.  First  Monday  of  January  to  April  1st,  the  books  01 
record  are  open  for  inspection,  then  closed  to  enable  board  of  taxes  ana 
assessments  to  prepare  assessment-roll. 

Section  895  Board  of  taxes  and  assessments  may  increase  or  di- 
minish value  of  real  or  personal  property  before  April  1st. 

Section  907.     From  April  1st  to  July  1st,  board  of  taxes  and  assess- 


308  PROCEEDINGS  BY  APPRAISERS. 

to  revise  and  cancel  same  had  expired  (April  1st),  but 
before  the  board  of  taxes  and  assessments  has  deliv- 
ered to  the  board  of  aldermen  the  assessment-rolls 
(first  Monday  in  July),  and  before  the  amount  of  the 
taxes  have  been  extended  thereon  (July  1st  to  Septem- 
ber 15th),  the  tax  imposed  upon  his  real  and  personal 
property  are  debts  of  his  estate,  and  where  his  execu- 
tors pay  them  in  compliance  with  subdivision  2  of  sec- 
tion 2719  of  the  Code  of  Civil  Procedure,  they  must  be 
allowed  as  a  deduction  by  the  appraiser.  Matter  of 
Hoffman,  42  Misc.  Rep.  90,  85  N.  Y.  S.  1082.  Following 
Matter  of  Babcock,  115  N.  Y.  450 ;  distinguishing  Mat- 
ter of  Maresi,  74  App.  Div.  76,  77  N.  Y.  S.  76. 

365.  Taxes  Assessed  in  Decedent's  Lifetime. 

Taxes  assessed  against  real  or  personal  property  of 
the  testator  in  his  lifetime  are  debts  owing  by  the  dece- 
dent and  proper  deductions.  Matter  of  Liss,  39  Misc. 
Rep.  123,  78  N.  Y.  S.  969. 

Taxes  levied  subsequent  to  testator's  death,  but 
assessed  prior  to  his  death,  should  be  deducted  if  paid 
by  the  executors.  Matter  of  Brundage,  31  App.  Div. 
348,  52  N.  Y.  S.  362. 

366.  Id When  Assessment-Roll  Completed. 

An  assessment,  so  far  completed  that  the  name  of 
the  person  cannot  be  changed  by  the  assessors  before 

ments  are  to  prepare  assessment-rolls  and  deliver  the  same  to  the 
board  of  aldermen  the  first  Monday  of  July. 

Section  909.  The  president  of  board  of  aldermen  to  cause  to  be 
properly  computed  the  taxes,  etc.,  between  first  Monday  of  July  and 
September   15th. 

Section  911.  Aldermen  are  to  deliver  to  receivers  of  tax  en  or  before 
September  15th,  with  warrant  for  collection. 


DEDUCTIONS.  309 

the  death  of  such  person,  is  payable  from  his  estate  in 
the  course  of  administration.  Matter  of  Babcock,  115 
N.  Y.  451. 

367.  Id. — Due  at  Decedent's  Death. 

Taxes  due  at  death  of  decedent  are  payable  out  of 
his  personal  estate,  and  taxes  accruing  subsequently 
are  chargeable  to  the  land.  Seabury  v.  Bo  wen,  3 
Bradf.  207;  Griswold  v.  Grisivold,  4  Bradf.  216;  Smith 
v.  Cornell,  111  N.  Y.  554. 

368.  Claims  Against  the  Decedent's  Estate. 

In  order  to  be  allowed  as  a  deduction,  all  claims 
must  be  shown  to  be  valid,  and  if  the  question  of  their 
validity  has  not  been  passed  upon  at  the  time  of  the 
tax  proceedings  their  allowance  by  the  appraiser  as 
a  deduction  should  be  reserved  for  a  future  proceed- 
ing. Matter  of  Wormser,  51  App.  Div.  441,  64  N.  Y.  S. 
897. 

369.  Doubtful  and  Uncertain  Claims. 

In  the  Matter  of  Rice,  56  App.  Div.  253,  61  N.  Y.  S. 
911,  68  N.  Y.  S.  1147,  it  was  held  that  where,  on  an 
original  appraisal,  deductions  for  doubtful  or  uncer- 
tain debts  or  claims  are  allowed,  the  appraiser's  report 
and  the  order  of  taxation  should  contain  a  recital  to 
the  effect  that  the  deduction  is  made  without  prejudice 
to  the  right  of  the  State  to  a  further  appraisal  and 
taxation  of  the  whole  or  any  part  thereof,  in  the  event 
that  it  shall  appear  that  the  items  so  deducted  are 
not  valid  claims,  or  are  of  less  value  than  the  amount 


310  PROCEEDINGS  BY  APPRAISERS. 

at  which  they  were  allowed  in  reduction  of  the  total 
assets  of  the  estate. 

370.  Disbursements  of  the  Executor  or  Administrator. 

In  the  Matter  of  Dimon,  82  App.  Div.  107,  81  N.  Y.  S. 
428,  the  court  outlined  the  practice  where  the  allow- 
ance of  certain  disbursements  of  the  executor  were 
claimed  as  a  proper  deduction.  In  this  case  the  estate 
was  valued  at  $41,000,  and  the  affidavit  of  the  adminis- 
trator showed  that  he  had  disbursed  for  funeral  ex- 
penses, legal  services,  and  disbursements  in  actions 
brought  against  the  estate,  $11,000.  The  appraiser 
refused  to  allow  the  amount  of  this  claim  for  more 
than  one-fourth  of  it.  The  Appellate  Division  stated 
that  if  this  right  of  the  appraiser  was  upheld,  claims 
allowed  by  him  might  thereafter  be  disallowed  by  the 
surrogate,  and  claims  disallowed  by  the  appraiser 
might  be  allowed  by  the  surrogate  on  the  accounting, 
and  therefore  there  was  some  danger  of  inconsistent 
decisions  on  the  same  question  by  the  surrogate  sitting 
first  as  an  assessing  officer  and  later  as  a  judge  to 
pass  upon  the  accounts.  The  court,  after  referring 
to  the  provisions  of  section  225,  says :  "  The  disburse- 
ments having  been  made  apparently  in  good  faith, 
and  being  shown  affirmatively  to  be  reasonable,  we 
think  they  should  have  been  allowed  by  the  appraiser 
and  by  the  surrogate  on  the  appeal.  Then,  if  it  should 
be  shown  on  the  accounting  that  too  much  was  al- 
lowed, the  surrogate  could  enter  an  order  assessing 
the  amount  of  the  property  thus  shown  to  have  been 
wrongfully  or  erroneously  deducted     *     *     *."     The 


DEDUCTIONS.  .  311 

court  states  further  that,  where  there  is  reasonable 
ground  for  doubting  the  validity  of  any  debt  paid,  or 
the  necessity  or  reasonableness  of  a  disbursement 
made,  the  report  of  the  appraiser  and  the  order  of 
the  surrogate  could  reserve  the  question  as  to  assess- 
ing the  transfer  tax  on  the  amount  representing  such 
debt  or  doubtful  claim  and  presently  impose  the  tax 
upon  the  rest,  and  the  tax  could  be  subsequently  im- 
posed upon  the  remainder  of  the  estate  to  the  extent 
that  it  passed  to  the  transferee  by  the  disallowance  of 
the  debt  or  claim  on  the  final  accounting.  See  Matter 
of  Thomas,  39  Misc.  Rep.  223,  79  N.  Y.  S.  571,  and 
Matter  of  Marks,  40  Misc.  Rep.  507,  82  N.  Y.  S.  803, 
as  to  the  allowance  of  a  sum  paid  in  compromise  or 
settlement  of  a  claim. 

371.  Funeral  Expenses. 

Of  decedent,  are  a  proper  deduction.  Matter  of 
Millward,  6  Misc.  Rep.  425,  27  N.  Y.  S.  286;  Matter  of 
Liss,  39  Misc.  Rep.  123,  78  N.  Y.  S.  969;  Matter  of 
Edgerton,  35  App.  Div.  125-131,  54  N.  Y.  S.  700;  affd., 
158  N.  Y.  671,  no  opinion.  Although  the  court  held, 
in  Matter  of  Black,  5  N.  Y.  S.  452,  that  a  bequest  for 
masses  was  taxable,  yet  the  general  practice  has  been 
to  allow  this  as  a  funeral  or  testamentary  expense 
where  the  sum  given  for  that  purpose  was  reasonable 
and  the  masses  were  to  be  said  for  the  repose  of  the 
decedent's  own  soul. 

372.  Cost  of  Burial  Plot. 

The  reasonable  cost  of  a  burial  plot  and  the  cost  of 
fencing  and  sodding  it  are  to  be  deducted.    Matter  of 


312  PROCEEDINGS  BY   APPRAISERS. 

Liss,  39  Misc.  Rep.  123,  78  N.  Y.  S.  969.  Also  a  reason- 
able sum  directed  to  be  expended  for  a  tombstone. 
Matter  of  Black,  5  N.  Y.  S.  452;  Matter  of  Edgerton,  35 
App.  Div.  125-131,  54  N.  Y.  S.  700;  affd.,  158  N.  Y.  671. 

373.  A  Judgment,  Liability  to  Pay  which  is  Secured  by  an 
Indemnity  Bond  and  Mortgage  is  not  a  Proper  De- 
duction. 
Where  a  judgment  is  obtained  against  the  admin- 
istrator cum  testamento  annexo  of  an  estate  for  up- 
ward of  $15,000,  and  it  appears  that  a  bond  and  mort- 
gage had  been  given  to  the  decedent  in  her  lifetime  to 
secure  and  save  her  harmless  from  any  liability  on  ac- 
count of  a  certain  claim,  or  any  judgment  thereon 
which  might  thereafter  be  obtained  against  her,  or  her 
executors,  such  a  judgment  is  not  a  proper  deduction 
in  transfer  tax  proceedings  involving  the  appraisal  of 
the  property  of  said  deceased  mortgagee,  where  it  ap- 
pears that  the  bond  and  mortgage  were  appraised  as  of 
"  no  value  "  the  same  being  in  the  nature  of  an  in- 
demnity for  said  judgment.  Matter  of  Skinner,  45 
Misc.  Rep.  559 ;  affd.,  in  this  respect,  in  106  App.  Div. 

The  Appellate  Division  says  that  the  legatee  having 
obtained  exemption  from  appraisal  of  the  alleged  se- 
curity on  the  ground  that  it  is  but  indemnity,  he  cannot 
in  the  next  breath  insist  that  the  debt  which  he  says  is 
indemnified  must  be  deducted,  because  it  is  absolute 
*  *  * ;  "  that  if  it  should  appear  eventually  that  the 
judgment  constituted  an  absolute  debt,  we  think  the 
appellant  has  a  remedy."  Citing  Matter  of  Dimon,  82 
App.  Div.  107,  81  N.  Y.  S.  428. 


DEDUCTIONS.  313 

374.  Debts  Due  New  York  Creditors  by  Nonresident  Decedent. 

Upon  the  appraisal  of  the  estate  of  a  nonresident 
member  of  a  firm  having  a  manufacturing  branch  in 
New  York  and  a  sales  department  in  another  State, 
debts  due  New  York  creditors  are  to  be  deducted  from 
New  York  assets.  Matter  of  King,  71  App.  Div.  581, 
76  N.  Y.  S.  220;  affd.,  172  N.  Y.  616,  no  opinion. 

(This  decision  has  not  been  followed  generally,  and  especially  is  this 
true  in  the  appraisal  of  the  individual  property  of  nonresidents,  a  pro- 
portionate part  of  debts  only  being  deducted  from  the  New  York  assets. ) 

The  surrogate  of  New  York  county,  in  the  Matter  of 
Doane,  N.  Y.  Law  Journal  of  March  12, 1903,  referring 
to  the  decision  in  the  Matter  of  King  (supra),  says: 
"  No  decision  of  any  court  has  yet  been  made  which 
would  justify  the  deduction  from  New  York  assets  of 
the  full  amount  of  claims  of  creditors  domiciled  in 
other  States,  or  the  entire  charges  for  mortuary  pur- 
poses incurred  after  the  death  of  the  decedent.  An 
allowance  must,  however,  be  made  of  such  portion  of 
the  debts,  owing  to  creditors  domiciled  elsewhere,  and 
for  funeral  charges  and  expenses  incident  to  burial  as 
the  New  York  assets  bear  to  the  entire  estate. ' ' 

375.  Doubtful  Claims. 

The  tendency  of  the  decisions  in  transfer  tax  cases 
has  been  to  follow  the  rule  that  where  there  are  claims 
which  are  doubtful,  their  assessment  must  be  expressly 
reserved,  or  if  such  claims  are  allowed  or  disallowed  in 
the  first  hearing,  the  remedy  of  the  party  aggrieved 
must  be  by  appeal.  Matter  of  Connoly,  38  Misc.  Rep. 
466,  77  N.  Y.  S.  1032;  Matter  of  Rice,  29  Misc.  Rep.  404, 
61  N.  Y.  S.  911;  affd.,  56  App.  Div.  253,  68  N.  Y.  S. 


314  PROCEEDINGS  BY  APPRAISERS. 

1147 ;  Matter  of  Wallace,  28  Misc.  Rep.  603,  59  N.  Y.  S. 
1084.  But  see  Matter  of  Dimon,  82  App.  Div.  107,  81 
N.  Y.  S.  428,  as  to  late  practice  in  this  respect. 

376.  Value  of  Particular  Estate. 

In  appraising  a  legacy  given  in  remainder  after  the 
death  or  remarriage  of  life  tenant  the  value  of  the 
particular  estate  is  to  be  deducted  from  the  principal 
of  the  fund.    Matter  of  Sloane,  154  N.  Y.  109. 

377.  Present  Value  of  an  Annuity. 

It  is  proper  in  calculating  for  the  purpose  of  the 
transfer  tax,  the  present  value  of  the  widow's  life 
estate  in  decedent's  residuary  estate,  which  is  also  sub- 
ject to  an  annuity  of  $200,  to  be  paid  decedent's  sister 
for  life,  to  deduct  from  the  net  value  of  the  personal 
property,  the  present  value  of  the  annuity,  instead  of 
deducting  the  actual  amount  of  principal  necessary  to 
produce  the  annuity  at  the  rate  of  5  per  cent,  per 
annum.  Matter  of  Maresi,  74  App.  Div.  76,  77  N.  Y. 
S.  76. 

378.  When  Cost  of  Annuity  a  Proper  Deduction. 

Where  decedent  gave  his  two  sisters  an  annuity  for 
$2,000  and  $4,000,  respectively,  "  requesting  his  exec- 
utors to  arrange  for  these  annuities  ' '  through  certain 
specific  insurance  companies,  and  it  appears  that  the 
cost  of  said  annuities  was  upward  of  $19,000  more 
than  their  present  value,  as  shown  by  the  computation 
of  the  Superintendent  of  Insurance,  Surrogate  Thomas 
has  held  (In  re  Hutchinson,  N.  Y.  Law  Journal  of  Jan. 
13,  1905),  that  the  cost  of  the  annuities  should  be  de- 


DEDUCTIONS.  315 

ducted  from  decedent's  residuary  estate,  and  not  the 
present  value,  as  shown  by  the  Superintendent  of  In- 
surance. The  surrogate  states  that  the  annuities  are 
regarded  as  legacies  of  the  sums  actually  paid  for 
them.  (Distinguishing  Matter  of  Maresi,  74  App.  Div. 
76;  Matter  of  Tracy,  179  N.  Y.  501) ;  arid,  by  the  Ap- 
pellate Division,  First  Department,  105  App.  Div. 

379.  Apportionment  of  Debts,  Etc.,  Between  Exempt  and  Non- 

exempt  Personal  Property. 

Where  the  personal  estate  of  a  decedent  consisted  in 
part  of  exempt  government  bonds,  the  debts,  expenses, 
etc.,  should  be  apportioned  ratably  between  the  bonds 
and  the  other  taxable  personal  property  for  the  pur- 
pose of  estimating  the  taxable  value  of  the  succession. 
Matter  of  Purdy,  24  Misc.  Eep.  301,  53  N.  Y.  S.  735. 
(Decision  under  Act  1892.) 

380.  Widow  Entitled  to  Money  Equivalent  in  Lieu  of  Neces- 

sary Provisions  and  Fuel  for  Sixty  Days. 

In  the  Estate  of  Bollweber,  N.  Y.  Law  Journal,  May 
31,  1905,  it  appeared  that  the  balance  in  the  hands  of 
the  administratrix  was  $235,  and  Surrogate  Thomas 
held  that  $150  of  this  sum  was  to  be  awarded  to  the 
widow  under  subdivision  5  of  section  2713  of  the  Code 
of  (  ivil  Procedure,  and  that  as  the  widow  was  also  en- 
titled to  all  necessary  provisions  and  fuel  for  herself 
and  children  for  sixty  days  after  the  death  of  her  hus- 
band, or  a  money  equivalent  therefor,  he  fixed  such 
sum  at  $85,  which  left  no  balance  for  distribution. 
Citing  Matter  of  Williams,  31  App.  Div.  617,  52  N.  Y. 
S.  700;  Matter  of  Libolt,  102  App.  Div.  29. 


316  PROCEEDINGS  BY  APPRAISERS. 

381.  Claims,  Etc.,   Not  Allowed  —  Expenses  of  Unnecessary 

Action. 

Executors  should  not  be  allowed  for  expenses  in  an 
action  unnecessarily  brought  by  them,  both  individu- 
ally and  in  their  representative  capacity,  for  a  con- 
struction of  the  will.  Matter  of  Thrall,  30  App.  Div. 
271,  51  N.  Y.  S.  595;  modified  in  other  respects,  157 
N.  Y.  46. 

382.  When  Debt  not  Allowed. 

Where  time  for  creditors  to  present  claims  to  exec- 
utor has  expired  and  the  creditor  testifies  that  he  does 
not  intend  to  enforce  the  collection  of  his  claim,  the 
appraiser  should  not  allow  it  as  a  deduction.  Matter 
of  Schwartz,  N.  Y.  Law  Journal  of  Feb.  17,  1903. 

383.  When  Commission  not  to  be  Deducted. 

Where  the  testator  directed  that  no  compensation  or 
commission  as  such  shall  be  paid  to  any  living  executor 
or  trustee  under  his  will  for  any  services  as  executor 
or  trustee,  the  amount  of  commissions  to  which  exec- 
utors are  usually  entitled  should  not  be  deducted  in 
ascertaining  the  taxable  value  of  the  estate.  Matter 
of  Vanderbilt,  68  App.  Div.  27,  74  N.  Y.  S.  450;  revd. 
on  another  point,  172  N.  Y.  69. 

384.  Counsel  Fees,  When  not  Allowed. 

In  the  Matter  of  Westurn,  152  N.  Y.  93,  the  will  of 
decedent  has  been  declared  void,  and  the  costs  and 
allowances  to  the  successful  contestants  (who  were  the 
sole  next  of  kin  and  heirs-at-law  of  decedent),  were 
directed  to  be  paid  out  of  the  estate  and  it  was  there- 


DEDUCTIONS.  317 

fore  contended  that   the  expenses   of  this  litigation 
should  be  deducted  from  the  estate  before  computing 
the  transfer  tax.    The  Court  of  Appeals  held  other- 
wise, saying :    ' '  The  fact  that  the  appellants  were  put 
to  expense  in  asserting  their  rights  and  were  embroiled 
in  expensive  litigation  to  obtain  them  was  their  mis- 
fortune.   It  did  not  diminish  the  value  of  the  interests 
which  devolved  upon  them  on  Westurn's  death.    It  was 
a  loss,  but  a  loss  to  their  general  estate.    It  did  not 
prevent  them  receiving  the  whole  interest  transmitted 
to  them.    The  fact  that  the  court  charged  certain  costs 
and  allowances  in  their  favor  upon  the  estate  did  not 
change  the  situation.    It  was  practically  a  charge  upon 
their  own  property  for  the  benefit  of  their  attorneys." 
The  courts,  however,  are  disposed  to  limit  the  strict 
application  of  this  decision  in  some  cases.    See  Matter 
of  Thomas,  39  Misc.  Rep.  223,  79  N.  Y.  S.  571,  where 
Surrogate  Thomas,  of  New  York  county,  holds  that  dis- 
bursements honestly  and  properly  made  by  an  exec- 
utor or  administrator  in  litigating  to  assert  a  right  of 
the  estate,  or  to  defeat  an  assault  upon  it,  or  even  in 
buying  peace  for  the  estate,  are  to  be  allowed  as  a  de- 
duction.   Also  Matter  of  Maresi,  74  App.  Div.  76,  77 
N.  Y.  S.  76,  where  the  costs  and  disbursements  of  an 
action  brought  by  the  executors  to  have  the  will  con- 
strued were  allowed  as  deductions,  the  court  saying: 
1 '  The  action  was  instituted  in  good  faith  and  was  fully 
justified  by  the  result.    The  expense  was  a  legitimate 
outlay  incurred,  not  by  the  legatees,  but  by  the  per- 
sonal representatives  of  the  estate,  in  order  to  secure 
judicial  construction  of  the  will  and  instruction  as  to 
the  distribution  of  the  estate  and  was  in  every  just 


318  PROCEEDINGS  BY  APPRAISERS. 

sense  a  proper  administrative  expenditure  of  funds 
which  do  not  pass  to  the  legatees  either  in  fact  or  in 
theory. ' ' 

385.  Sum  Paid  for  Withdrawal  of  Objections  to  Probate  — 

Not  Allowed. 

But  where  the  proponents  of  a  will  paid  a  niece  of 
testator,  who  had  filed  objections  to  its  probate,  $10,000 
to  induce  her  to  withdraw  her  objections,  the  court 
held  that  there  was  no  purchase  of  peace  "  for  the 
estate  "  by  such  a  settlement,  but  that  the  payment  to 
the  niece  was  one  ' '  out  of  the  property  transferred  to 
the  beneficiaries  in  satisfaction  of  their  own  contract 
obligation,  and  was  not  an  expense  of  administering 
the  estate  or  deductible  from  the  appraisal."  Matter 
of  Marks,  40  Misc.  Rep.  507,  82  N.  Y.  S.  803. 

386.  The  Amount  of  the  Individual  Bond  of  a  Decedent  Ac- 

companying a  Mortgage  Executed  by  Both  Decedent 
and  His  Wife  Upon  Real  Estate  Owned  by  the  Wife, 
Will  not  be  Deducted  from  the  Decedent's  Personal 
Estate  as  a  Debt  Owing  by  Him. 

In  the  Matter  of  Caiman,  100  App.  Div.  517,  it  ap- 
peared from  the  evidence  adduced  before  the  appraiser 
that  on  May  13,  1895,  the  decedent,  Emil  Caiman,  con- 
veyed to  his  wife  certain  real  estate  in  New  York  city, 
subject  to  a  mortgage  of  $35,000.  This  deed  was  not 
recorded  until  after  Emil  Caiman's  death,  June  17, 
1902.  In  1898,  while  this  deed  to  his  wife  was  still  un- 
recorded, the  decedent  procured  a  new  loan  of  $35,000 
upon  said  premises  and  with  the  money  thus  received 
paid  off  the  mortgage  for  the  same  amount  which  was 
upon  said  premises  when  they  were  deeded  to  his  wife 


DEDUCTIONS.  319 

in  1895.  The  new  mortgage  was  made  by  the  decedent 
and  his  wife  as  though  the  decedent  was  the  owner  of 
the  fee  of  the  premises  and  the  individual  bond  of  the 
decedent  accompanied  said  mortgage.  No  evidence 
was  offered  to  explain  the  decedent's  object  in  repre- 
senting himself  as  the  owner  of  the  premises  and  in 
executing  the  bond  and  mortgage  for  $35,000  as  such 
owner,  except  that  the  executors  claimed  that  the  dece- 
dent intended  to  make  a  gift  to  his  wife  of  the  old  mort- 
gage, which  was  satisfied  when  the  new  bond  and  mort- 
gage was  given,  and  in  so  doing  made  himself  liable 
for  the  amount  thereof. 

The  appraiser  refused  to  allow  the  $35,000  repre- 
senting the  amount  of  the  personal  bond  of  decedent  as 
a  deduction  from  the  decedent's  personal  estate  and  the 
surrogate  confirmed  this  report. 

The  executors  appealed  from  the  order  of  the  sur- 
rogate assessing  the  tax  upon  the  ground  that  "  said 
report  failed  to  allow  as  a  deduction  from  the  prop- 
erty of  the  decedent  *  *  *  a  certain  indebtedness 
of  decedent  for  $35,000,  evidenced  by  his  personal  bond, 
although  such  indebtedness,  being  a  liability  of  the 
estate  of  said  decedent,  should  have  been  deducted 
*  *  *."  The  surrogate  affirmed  his  previous  order, 
and  the  Appellate  Division  of  the  First  Department 
on  January  19,  1905,  affirmed  the  surrogate's  decision, 
without  opinion. 

387.  Articles  Enumerated  in  Subdivision  3  of  Section  2713  of 
the  Code— Not  Entitled  to  Money  Allowance  Therefor. 

Under  subdivision  3  of  section  2713  of  the  Code  of 
Civil  Procedure,  entitling  the  husband,  wife,  and  minor 


320  PROCEEDINGS  BY  APPRAISERS. 

children  of  a  decedent  to  have  set  apart  to  them  out  of 
the  decedent's  estate  the  articles  enumerated  therein, 
such  as  sheep,  swine,  cows,  etc.,  the  husband,  wife,  and 
minor  children  are  not  entitled,  if  the  decedent  was  not 
possessed  of  such  articles,  to  a  money  allowance 
equivalent  to  their  value,  nor  in  such  a  case  should  the 
money  equivalent  of  such  articles  be  deducted  from 
the  value  of  the  assets  of  the  decedent's  estate  when 
fixing  the  amount  of  the  transfer  tax  thereon.  Matter 
of  Libolt,  102  App.  Div.  29,  distinguishing  Matter  of 
Williams,  31  App.  Div.  617,  52  N.  Y.  S.  700.  See  Mat- 
ter of  Keough,  42  Misc.  Eep.  387,  86  N.  Y.  S.  807,  and 
Baucus  v.  Stover,  24  Hun,  109. 

388.  Legacy  to  a  Creditor  —  Not  to  be  Deducted. 

A  general  clause  in  a  will  directing  an  executor  to 
pay  the  decedent's  just  debts,  funeral  expenses,  etc., 
from  his  personal  estate  has  never  been  questioned  as 
being  a  transfer  by  will  to  the  extent  of  such  debts  and 
expenses,  and  therefore  subject  to  the  provision  of 
this  act ;  but  where  by  the  terms  of  the  will  the  testator 
attempts  to  pay  an  indebtedness  or  claim  against  him 
by  making  a  bequest  to  the  creditor  in  liquidation  of 
the  claim,  such  bequest  is  taxable,  as  a  legacy,  if  ac- 
cepted by  the  creditor. 

The  Court  of  Appeals  said  in  the  Matter  of  Gould, 
156  N.  Y.  423-428 :  ' '  It  matters  not  what  the  motive  of 
a  transfer  by  will  may  be,  whether  to  pay  a  debt,  dis- 
charge some  moral  obligation,  or  to  benefit  a  relative 
for  whom  the  testator  entertains  a  strong  affection,  if 
the  devise  or  bequest  be  accepted  by  the  beneficiary,  the 


DEDUCTIONS.  321 

transfer  is  made  by  will,  and  the  State,  by  the  statute 
in  question,  makes  a  tax  to  impinge  upon  that  per- 
formance. ' ' 

To  the  same  effect,  see  Matter  of  Rogers,  71  App. 
Div.  461,  75  N.  Y.  S.  835. 

389.  When  Debt*  Owing  by  Nonresidents  not  Allowed. 

In  assessing  bonds  and  stocks  of  domestic  corpora- 
tions owned  by  a  nonresident  and  located  within  this 
State,  no  deduction  should  be  made  for  debts  of  dece- 
dent due  to  residents  of  this  State  and  secured  in  part 
by  a  pledge  of  stocks  of  corporations  of  other  States, 
when  it  appears  that  the  value  of  the  pledged  securities 
is  greater  than  the  indebtedness  and  the  general  assets 
of  the  estate  are  five  times  in  excess  of  the  liabilities. 
Matter  of  Pullman,  46  App.  Div.  574,  62  N.  Y.  S.  395. 

390.  Mortgage  Debts  not  Allowed. 

Mortgage  debts  of  testator  are  not  to  be  deducted 
from  decedent's  personal  estate  prior  to  the  assessment 
of  the  tax.  Matter  of  Sutton,  3  App.  Div.  208,  38  N.  Y. 
S.  277;  affd.,  149  N.  Y.  618;  Matter  of  Offerman,  25 
App.  Div.  94,  48  N.  Y.  S.  993;  Matter  of  Murphy,  32 
App.  Div.  627,  53  N.  Y.  S.  1110;  affd.,  157  N.  Y.  679. 

A  direction  by  testator  to  pay  certain  mortgages  out 
of  personalty  does  not  authorize  the  appraiser  to  de- 
duct the  amount  from  the  value  of  the  personal  estate. 
Matter  of  Berry,  23  Misc.  Rep.  230,  51  N.  Y.  S.  1132 
Matter  of  DeGraff,  24  Misc.  Rep.  147,  53  N.  Y.  S.  591 
Matter  of  Livingston,  1  App.  Div.  368,  37  N.  Y.  S.  463 
21 


322  PROCEEDINGS  BY  APPRAISERS. 

Matter  of  Maresi,  74  App.  Div.  76,  77  N.  Y.  S.  76.  Un- 
der chapter  41,  Laws  1903,  mortgages  are  deducted 
from  appraised  value  of  the  real  estate. 

391.  Tax  Paid  in  Another  State. 

Taxes  on  transfers  paid  by  the  laws  of  other  States 
are  not  to  be  deducted.  Matter  of  Clark,  N.  Y.  Law 
Journal  of  Dec.  26,  1904;  Matter  of  Gihon,  169  N.  Y. 
443. 

The  fact  that  property  may  be  subject  to  tax  under 
the  laws  of  another  State  does  not  relieve  such  prop- 
erty from  our  Transfer  Tax  Law  if  it  is  otherwise  tax- 
able under  our  laws.  Matter  of  Burr,  16  Misc.  Rep. 
89,  38  N.  Y.  S.  811;  Blackstone  v.  Miller,  188  U.  S.  187; 
Matter  of  Kennedy,  20  Misc.  Rep.  531,  46  N.  Y.  S.  906 ; 
Matter  of  Daly,  100  App.  Div.  373. 

While  the  Federal  legacy  tax  was  in  force  (1898 
to  1902)  a  difference  of  opinion  arose  in  regard  to  the 
question  as  to  whether  or  not  the  amount  paid  to"  the 
United  States  for  the  Federal  inheritance  tax  should 
first  be  deducted  before  computing  the  tax  here.  Sev- 
eral of  the  surrogates  (Cattaraugus,  Erie,  and  Orange 
counties)  all  held  that  as  the  Federal  tax  was  not  in 
the  nature  of  a  debt  that  it  could  not  be  deducted. 
Matter  of  Irish,  28  Misc.  Rep.  647,  60  N.  Y.  S.  30; 
Matter  of  Becker,  26  Misc.  Rep.  633,  57  N.  Y.  S.  940; 
Matter  of  Curtis,  31  Misc.  Rep.  83,  64  N.  Y.  S.  574. 
The  surrogate  of  Westchester  county  held  that  the 
Federal  tax  should  be  deducted,  in  the  Matter  of  Gihon, 
33  Misc.  Rep.  206,  68  N.  Y.  S.  381,  on  the  ground  that 
the  beneficiary  as  a  matter  of  fact  only  received  the 


DEDUCTIONS.  323 

amount  of  the  legacy,  less  the  Federal  tax,  and  that  she 
should  not  pay  a  tax  upon  something  she  would  never 
receive.  The  Appellate  Division  sustained  the  deci- 
sion (64  App.  Div.  504,  72  N.  Y.  S.  1104),  and  the  same 
position  was  taken  by  the  Appellate  Division  of  the 
First  Department  in  the  Matter  of  Vanderbilt,  68  App. 
Div.  27,  74  N.  Y.  S.  450.  The  Gihon  Case  was  taken  to 
the  Court  of  Appeals  (169  N.  Y.  443),  and  that  court 
reversed  the  court  below,  holding  that  it  was  an  error 
to  assume  that  the  Federal  tax  was  primarily  payable 
out  of  the  estate.  In  this  opinion  Judge  Cullen  says : 
' '  The  Federal  tax  is  of  exactly  the  same  nature  as  the 
State  tax;  a  tax  not  on  property,  but  on  succession; 
that  is  to  say,  a  tax  on  the  legatee  for  the  privilege  of 
succeeding  to  property.  Knowlton  v.  Moore,  178  U.  S. 
41.  The  Federal  tax  is  necessarily  of  this  character, 
for  a  direct  tax,  unless  apportioned  according  to  popu- 
lation, would  be  repugnant  to  the  Constitution  of  the 
United  States.  Under  that  statute,  also,  it  is  the 
amount  of  the  legacy,  not  of  the  estate,  that  determines 
the  rate  of  taxation.  Therefore,  though  the  admin- 
istrator or  executor  is  required  to  pay  the  tax,  he  pays 
it  out  of  the  legacy  for  the  legatee,  not  on  account  of 
the  estate.  The  requirement  of  the  statute  that  the 
executor  or  administrator  shall  make  the  payment  is 
prescribed  to  secure  such  payment,  because  the  gov- 
ernment is  unwilling  to  trust  solely  to  the  legatee.  No 
one  questions  that  where  a  legacy  is  given  for  a  speci- 
fied amount  the  tax  must  be  deducted  from  the  amount 
of  the  legacy  and  the  balance  only  given  to  the  legatee. 
A  testator  may  direct  that  the  tax  on  a  particular 


324  PROCEEDINGS  BY  APPRAISERS. 

legacy  shall  be  paid  out  of  his  estate ;  nevertheless,  in 
reality,  the  tax  is  still  paid  out  of  the  legacy,  the  effect 
of  the  direction  of  the  testator  being  merely  to  increase 
the  legacy  by  the  amount  of  the  tax." 

392.  Taxes  Under  Greater  New  York  Charter,  When  not  De- 

ductible. 

Under  this  charter  it  is  held  that  the  assessment-roll 
is  not  completed  until  the  amount  chargeable  against 
each  parcel  of  land  is  computed  and  set  down,  when  the 
lien  attaches  and  it  is  a  debt  and  therefore  deductible. 
Burr  v.  Palmer,  53  App.  Div.  358,  65  N.  Y.  S.  1056. 

Accordingly  held  in  the  Matter  of  Maresi,  74  App. 
Div.  76,  77  N.  Y.  S.  76,  that  where  testator  died  Janu- 
ary 30,  1901,  taxes  for  the  year  1900  are  not  deductible 
from  his  personal  estate  and  the  tax  was  not  a  lien  at 
the  time  of  death.  But  see  Matter  of  Hoffman,  42  Misc. 
Rep.  90,  85  N.  Y.  S.  1082. 

393.  Repairs  to  Real  Estate  not  Allowed. 

The  expense  of  repairs  to  real  estate  under  a  con- 
tract entered  into  by  decedent  in  his  lifetime  and  not 
fully  completed  until  after  his  death  are  not  deductible 
from  the  personal  estate.  Matter  of  McNeill,  N.  Y. 
Law  Journal  of  June  21,  1902 ;  Matter  of  Baudouine,  5 
App.  Div.  622,  39  N.  Y.  S.  1121.  But  see  Matter  of 
Tracy,  179  N.  Y.  501,  when  such  items  are  proper. 

394.  Tax  Directed  to  be  Paid  as  an  Administration  Expense. 

When  the  will  provides  that  transfer  tax  shall  be 
paid  by  the  executor  as  an  expense  of  administration, 


DEDUCTIONS.  325 

the  residuary  estate  should  not  be   reduced  by  the 
amount  of  such  taxes.    Matter  of  Swift,  137  N.  Y.  77. 

395.  When  Debts  Cannot  be  Deducted  After  Appraisal. 

Debts  cannot  be  deducted  after  the  appraisal  has 
been  made  and  the  time  to  appeal  has  expired,  unless 
they  were  reserved  for  future  action  at  the  time  of 
the  appraisal.    Matter  of  Morgan,  36  Misc.  Rep.  753, 

74  N.  Y.  S.  478. 


CHAPTER  XVI. 


Determination  of  Surrogate. 


396.  Determination  of  surrogate. 

397.  Value     of     the     estate     and 

amount  of  tax;   how  deter- 
mined. 

398.  The  surrogate  is  the  assessing 

and  taxing  officer. 

The  taxing  order  is  the  order 
of  the  Surrogate's  Court. 

When      application      to      the 
Superintendent  of  Insurance 
necessary. 
401.  Notice    of    determination;    to 
whom  given. 

Presumption  of  notice. 

Determination;   how  far  con- 
clusive. 

Id.;    final  as  to  known  prop- 
erty. 


399. 


400. 


402. 
403. 

404. 


405.  Surrogate  to  forward  copies  of 

all  orders  to  Comptroller. 

406.  When  order  is  not  entered  by 

consent. 

407.  Interest  of  beneficiaries  under 

the  order. 

408.  Vacating  order;  newly-discov- 

ered evidence. 

409.  Report  can  be  sent  back  for 

correction. 

410.  Surrogate's   power   to   correct 

clerical  errors. 

411.  Order  of  exemption;  ex  parte 

application  for. 

412.  Appointment  of  guardian. 

413.  Corresponding  section  of  for- 

mer acts ;  relating  to  the  de- 
termination of  the  surrogate. 


396.  Determination  of  Surrogate. 

[§  231,  Tax  Law.]  From  such  report  of  appraisal  and 
other  proof  relating  to  any  such  estate  before  the  surrogate, 
the  surrogate  shall  forthwith,  as  of  course,  determine  the 
cash  value  of  all  estates  and  the  amount  of  tax  to  which  the 
same  are  liable  j1  or  the  surrogate  may  so  determine  the  cash 
value  of  all  such  estates  and  the  amount  of  tax  to  which  the 
same  are  liable,  without  appointing  an  appraiser.2 

1.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year.— Section 
13  provided  that  the  surrogate  should  determine  the  value  of  the  estate 
forthwith  from  the  report  of  the  appraiser,  etc. 

By  Chap.  399,  Laws  1892  — in  effect  May  1  of  that  year.— Section 
13  provided  that  from  the  report  of  the  appraiser,  etc.,  the  surrogate 
shall  forthwith  "  as  of  course  "  determine  the  cash  value,  etc. 

2.  Chap.  399,  Laws  1892  — in  effect  May  1  of  that  year.— First  pro- 
vided that  the  surrogate  could  determine  the  cash  value  and  amount 
of  tax  without  appointing  an  appraiser. 

[326] 


DETERMINATION    OF    SURROGATE.  327 

The  superintendent  of  insurance  shall,  on  the  application 
of  any  surrogate,  determine  the  value  of  any  such  future  or 
contingent  estates,  income  or  interest  therein  limited,  con- 
tingent, dependent  or  determinable  upon  the  life  or  lives  of 
persons  in  being,  upon  the  facts  contained  in  any  such  ap- 
praiser's report,  and  certify  the  same  to  the  surrogate,  and 
his  certificate  shall  be  conclusive  evidence  that  the  method  of 
computation  adopted  therein  is  correct.3 

The  surrogate  shall  immediately  give  notice,  upon  the  de- 
termination by  him  as  to  the  value  of  any  estate  which  is 
taxable  under  this  article,  and  of  the  tax  to  which  it  is  liable, 
to  all  persons  known  to  be  interested  therein,4  and  shall  im- 
mediately forward  a  copy  of  such  taxing  order  to  the  state 
comptroller.5  The  surrogate  shall  also  forward  to  the  state 
comptroller  copies  of  all  orders  entered  by  him  in  relation  to 
or  affecting  in  any  way  the  transfer  tax  on  any  estate,  in- 
cluding orders  of  exemption.6 

If,  however,  it  appear  at  any  stage  of  the  proceedings  that 
anv  of  such  persons  known  to  be  interested  in  the  estate  is 
an  infant  or  an  incompetent,  the  surrogate  may,  if  the  in- 
terest of  such  infant  or  incompetent  is  presently  involved 
and  is  adverse  to  that  of  any  of  the  other  persons  interested 
therein,  appoint  a  special  guardian  of  such  infant ;  but  noth- 
ing in  this  provision  shall  affect  the  right  of  an  infant  over 
fourteen  years  of  age  or  of  any  one  on  behalf  of  an  infant 
under  fourteen  years  of  age  to  nominate  and  apply  for  the 
appointment  of  a  special  guardian  for  such  infant  at  any 
stage  of  the  proceedings.7 

3.  Chap.  713,  Laws  1887  — in  effect  June  25  of  that  year.— Amend- 
in"  Met  ion   13  of  the  Act  of  1885,  first  enacted  this  provision. 

4.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year. —  Section 
13  required  the  surrogate  to  give  notice  by  mail  to  all  interested  parties 
as  soon  as  he  had  assessed  the  tax. 

5.  (hap.  368,  Laws  1905  — in  effect  June  1  of  that  year.— Requires 
the  surrogates  to  forward  copy  of  the  taxing  order  to  the  State  Comp- 
troller. (Now.)  Prior  to  this  the  surrogate  was  only  required  to  send 
the  State  Comptroller  a  notice  of  the  assessment. 

6.  Chap.  308,  Laws  1005  — in  effect  June  1  of  that  year  — l'irst 
enacted  this  provision  of  section  231. 

7.  Chap.  672,  Laws  1899  — in  effect  May  25  of  that  year.— Added  the 
provision   in   reference  to  the  appointment  of  a  guardian,  etc., —  if  it 


328  THE    LAW    OF    TAXABLE    TRANSFERS. 

397.  Value  of  the  Estate  and  Amount  of  Tax,  How  Deter- 

mined. 

Since  the  Act  of  1892  the  statute  has  presented  two 
methods  of  determining  the  cash  value  of  all  estates, 
and  the  amount  of  tax  to  which  the  same  are  liable. 

First.  From  the  report  of  the  appraiser,  and  other 
proof  before  the  surrogate  relating  to  such  estate,  the 
surrogate  shall  forthwith,  as  of  course,  determine  the 
cash  value  thereof  and  the  amount  of  tax ;  or, 

Second.  The  surrogate  may  so  determine  the  cash 
value  of  all  such  estates  and  the  amount  of  tax,  without 
appointing  an  appraiser.     (§  231.) 

The  general  practice  is,  however,  to  refer  the  ap- 
praisal of  the  estate  to  the  official  appraiser. 

398.  The  Surrogate  is  the  Assessing  and  Taxing  Officer. 

In  either  event,  the  surrogate  is,  in  effect,  first  made 
the  assessing  and  taxing  officer,  who  represents  the 
State,  and  enters  an  order  fixing  the  tax  "as  of 
course,"  and  from  this  determination  an  appeal  lies 
to  the  surrogate  sitting  as  a  judge,  when  for  the  first 
time  the  proceeding  takes  on  a  judicial  character. 
Weston  v.  Goodrich,  86  Hun,  194,  33  N.  Y.  S.  382; 
Matter  of  Wolfe,  137  N.  Y.  205. 

appears  at  "  this  "  stage  of  the  proceedings  that  any  of  the  interested 
parties  are  infants,  see  former  section  232.  It  is  not  clear  whether  the 
reference  to  "  this  stage  of  the  proceedings  "  referred  to  the  provision 
in  reference  to  an  appeal  or  the  provision  in  reference  to  the  surrogate 
giving  notice  of  his  determination  of  tax  to  all  interested  parties,  as 
the  provision  in  reference  to  the  appointment  of  guardian  immediately 
follows  both  of  these  provisions. 

By  Chap.  36S,  Laws  1905  —  in  effect  June  1  of  that  year. —  Any  doubt 
as  to  the  provision  to  which  the  former  provision  in  reference  to  ap- 
pointing a  guardian  referred  to  was  taken  away,  by  this  act  providing 
for  the  appointment  of  a  guardian  at  "  any  "  stage  of  the  proceedings. 


DETERMINATION    OF    SURROGATE.  329 

399.  The  Taxing  Order  is  the  Order  of  the  Surrogate's  Court. 

Assuming  that  a  surrogate,  in  fixing  a  transfer  tax 
and  making  the  decree  assessing  it,  does  not  act  as  sur- 
rogate, but  simply  as  a  taxing  officer,  yet  the  decree, 
upon  the  taxation,  becomes  a  decree  or  order  of  his 
court.  Matter  of  Scrimgeour,  80  App.  Div.  388,  80 
N.  Y.  S.  636;  affd.,  175  N.  Y.  507. 

400.  When  Application  to  the  Superintendent  of  Insurance 

Necessary. 

In  all  cases  where  it  is  necessary  to  determine  the 
value  of  any  future  or  contingent  estate,  income,  or 
interest  therein  limited,  contingent,  dependent,  or  de- 
terminable upon  the  life  or  lives  of  persons  in  being, 
the  surrogate,  upon  the  facts  contained  in  the  ap- 
praiser's report,  is  directed  to  apply  to  the  Superin- 
tendent of  Insurance,  who  is  required  to  determine  the 
value  thereof  and  certify  the  same  to  the  surrogate, 
and  his  certificate  shall  be  conclusive  evidence  that  the 
method  of  computation  adopted  therein  is  correct. 
(See  ante,  page  275,  where  this  provision  of  §  230  of 
the  Tax  Law,  is  further  considered.) 

401.  Notice  of  Determination,  to  Whom  Given. 

The  surrogate  shall  immediately,  upon  the  deter- 
mination by  him  of  the  value  of  the  estate  and  the  tax 
to  which  it  is  liable,  give  notice  of  such  determination 
to  all  persons  known  to  be  interested  therein.    (§  231.) 

402.  Presumption  of  Notice. 

In  the  absence  of  proof  to  the  contrary,  it  will  be  pre- 
sumed that  the  surrogate  has  given  the  required  notice 


330        THE  LAW  OF  TAXABLE  TRANSFERS. 

to  all  persons  interested  in  the  estate.     Matter  of  Mil- 
ler, 110  N.  Y.  216.    (Decision,  Act  1885.) 

403.  Determination)  how  Far  Conclusive. 

In  proceedings  nnder  the  Inheritance  Tax  Act,  the 
determination  of  the  surrogate  that  a  certain  amount 
of  property  passed  to  a  residuary  legatee  is  binding 
upon  the  question  of  taxation  only,  and  is  not  conclu- 
sive upon  the  rights  of  parties  arising  outside  of  the 
will.     Amherst  College  v.  Ritch,  151  N.  Y.  282. 

404.  Id.;  Final  as  to  Known  Property. 

Where  a  surrogate,  knowing  of  the  existence  of  per- 
sonal property,  does  not  tax  it,  there  is  a  determination 
that  it  is  not  taxable,  which  becomes  final  where  there 
was  no  appeal  from  the  order  of  taxation  and  it  has 
stood  for  five  years.  Matter  of  Lansing,  31  Misc.  Rep. 
148,  64  N.  Y.  S.  1125. 

405.  Surrogate  to  Forward  Copies  of  all  Orders  to  Comptroller. 
The  surrogate,  by  the  Act  of  1905,  is  required  to 

immediately  forward  to  the  State  Comptroller  a  copy 
of  the  taxing  order,  also  copies  of  all  orders  entered 
by  him  in  relation  to  or  affecting  in  any  way  the  trans- 
fer tax  on  any  estate,  including  orders  of  exemption. 
(§  231.) 

406.  When  Order  is  not  Entered  by  Consent. 

An  order  granted  on  sustaining  and  opposing  affi- 
davits, and  after  opposition  of  counsel,  can  hardly  be 
called  an  order  entered  by  consent.  Matter  of  Post,  85 
App.  Div.  611,  82  N.  Y.  S.  1079. 


DETERMINATION    OF    SURROGATE.  331 

407.  Interests  of  Beneficiaries  Under  the  Order. 

Under  the  order  imposing  the  tax,  the  interests  of 
different  beneficiaries  are  separate  and  independent. 
Matter  of  Bogert,'25  Misc.  Rep.  466,  55  N.  Y.  S.  751. 

408.  Vacating  Order  —  Newly-Discovered  Evidence. 

Ordinarily,  where  the  determination  is  set  aside  on 
the  ground  of  newly-discovered  evidence,  the  order  set- 
ting it  aside  should  not  contain  an  adjudication  con- 
trary to  the  former  determination,  but  should  provide 
for  a  new  hearing. 

This  rule,  however,  does  not  make  it  improper  for  a 
surrogate,  when  incontrovertible  evidence  discovered 
since  the  entry  of  the  order  imposing  a  tax  is  pre- 
sented to  him  establishing  that  the  estate  is  not  subject 
to  any  transfer  tax,  to  vacate  the  order  imposing  the 
tax  and  it  is  not  necessary  for  him  to  remit  the  matter 
to  the  official  appraiser  to  make  the  computation  upon 
which  the  taxability  of  the  property  depends,  particu- 
larly as,  under  section  232  (now  section  231)  of  the 
Tax  Law,  he  is  expressly  empowered  to  determine  the 
amount  of  the  transfer  tax,  without  appointing  an  ap- 
praiser. Matter  of  Cameron,  97  App.  Div.  436,  89 
N.  Y.  S.  977;  affd.,  181  N.  Y.  Mem.  58,  without  opinion. 

(As  to  conclusiveness  of  order  see  Matter  of  Law- 
rence, 96  App.  Div.  29,  88  N.  Y.  S.  1028.) 

409.  Report  Can  be  Sent  Back  for  Correction. 

If  a  surrogate  inadvertently  confirms  a  fatally 
defective  report,  he  may  vacate  the  order  of  confirma- 
tion and  recommit  the  report  for  correction.  Matter 
of  Earle,  74  App.  Div.  458,  77  N.  Y.  S.  503. 


332  THE    LAW    0*    TAXABLE    TRANSFERS, 

410.  Surrogate's  Power  to  Correct  Clerical  Errors. 

There  is  no  statutory  limitation  of  time  upon  the 
exercise  by  a  surrogate  of  the  power  declared  by  sub- 
division 6  of  section  2481  of  the  Code  of  Civil  Proce- 
dure to  correct,  upon  motion,  a  clerical  error  in  a  de- 
cree made  by  him,  where  the  motion  does  not  involve 
a  review  of  his  decision  upon  the  merits,  but  simply 
calls  for  a  correction  of  the  record  in  accordance  with 
the  facts.     Matter  of  Henderson,  157  N.  Y.  423. 

41 1 .  Order  of  Exemption  —  Ex  Parte  Application  for. 
There  is  no  express  provision  directing  the  surro- 
gate to  enter  an  order  exempting  an  estate  which  ap- 
pears by  the  report  of  the  appraiser  to  be  exempt,  but 
the  practice  has  been  to  enter  such  orders,  and  it  would 
seem  that  authority  for  such  action,  where  transfer 
tax  proceedings  have  been  regularly  instituted,  is  given 
in  the  language  used  in  section  228  (formerly  section 
229),  which  declares  that  the  Surrogate's  Court  shall 
have  jurisdiction  to  hear  and  determine  all  questions 
arising  under  the  provisions  of  this  article,  and  to  do 
any  act  in  relation  thereto  authorized  by  law  to  be 
done  by  a  surrogate  in  other  matters  or  proceedings 
coming  within  his  jurisdiction.  It  has  also  been  the 
practice  in  some  counties  for  the  surrogate  to  enter  an 
order  upon  the  ex  parte  application  of  the  representa- 
tives of  the  State  upon  an  affidavit  or  petition  purport- 
ing to  show  the  value  of  the  estate  to  be  below  the  tax- 
able limitations,  but  the  surrogate  in  such  a  case  is 
clearly  not  authorized  to  entertain  such  a  proceeding 


DETERMINATION    OF    SURROGATE.  333 

without  due  notice  to  the  State  Comptroller.     (See 
§  231.) 

The  Appellate  Division  of  the  Second  Department 
says,  in  the  Matter  of  Collins,  104  App.  Div.  184:  "  If 
an  effective  order  of  exemption  can  be  made  without 
notice  to  the  State  Comptroller,  it  would  seem  that 
the  State  might  thus  be  barred  of  all  rights  to  enforce 
or  recover  any  transfer  tax  by  the  ex  parte  action  of 
the  surrogate.  I  do  not  think  that  the  procedure 
established  by  the  Tax  Law  was  designed  to  permit 
any  such  result;  but  even  though  the  lack  of  notice 
be  not  deemed  a  jurisdictional  defect,  it  seems  to  me 
that  it  should  be  regarded  as  an  objection  which  is  fatal 
to  the  order  upon  a  direct  review  thereof  by  appeal." 

412.  Appointment  of  Guardian. 

No  appointment  of  a  special  guardian  for  an  infant 
should  be  made  by  the  surrogate,  where  the  infant's 
interests  are  all  in  remainder  and  cannot  be  determined 
or  taxed  in  the  pending  proceedings.  Matter  of  Post, 
5  App.  Div.  113,  38  N.  Y.  S.  977. 

By  the  amendment  of  1905  the  surrogate  may  ap- 
point a  guardian  at  any  stage  of  the  proceedings  in 
behalf  of  an  infant  or  other  incompetent,  providing 
the  interest  of  such  infant  or  incompetent  is  presently 
involved,  and  is  adverse  to  that  of  any  of  the  other 
interested  persons.    (§  231.) 

41 3.  Corresponding  Sections  —  Of  Former  Acts  —  Relating  to 

the  Determination  of  the  Surrogate. 

Section  13  of  the  Act  of  1885  provided  that  from 
the  report  of  the  appraiser  the  surrogate  shall  forth- 


334  THE    LAW    OF    TAXABLE    TRANSFERS. 

with  assess  and  fix  the  then  cash  value  of  all  estates, 
annuities,  and  life  estates,  or  term  of  years,  growing 
out  of  such  estate,  and  the  tax  to  which  the  same  is 
liable,  and  that  he  should  immediately  give  notice 
thereof  to  all  interested  persons  by  mail.  Section  13 
was  amended  by  chapter  713,  Laws  1887,  in  effect 
June  25th  of  that  year,  by  providing  that  the  value 
of  every  future  and  contingent  estate  should  be  deter- 
mined by  the  Superintendent  of  Insurance  in  accord- 
ance with  the  methods  and  standards  of  mortality  and 
value  employed  by  said  Superintendent  in  ascertaining 
the  value  of  the  life  insurance  policies. 

The  provisions  of  section  13,  as  amended,  were  sub- 
stantially re-enacted  by  chapter  399,  Laws  1892  (§  13), 
in  effect  May  1st  of  that  year,  and  were  substantially 
re-enacted  by  chapter  908,  Laws  1896,  in  effect  June 
15th  of  that  year,  in  section  232  of  said  act,  with 
amendments  providing  that  the  report  of  the  appraiser 
should  be  made  in  duplicate,  and  one  copy  filed  in  the 
State  Comptroller's  office,  and  a  new  provision  allow- 
ing the  Comptroller  of  the  State,  within  two  years 
from  the  entry  of  an  order,  where  he  believes  the  ap- 
praisal and  determination  has  been  fraudulently  or 
erroneously  made,  to  make  application  to  a  justice  of 
the  Supreme  Court  for  a  reappraisal  of  the  estate. 
Section  232  was  amended  by  chapter  284,  Laws  1897, 
in  effect  April  16th  of  that  year,  by  requiring  a  certi- 
fied copy  of  the  determination  of  the  justice  to  be  trans- 
mitted to  the  Surrogate's  Court  of  the  proper  county. 

By  chapter  672,  Laws  1899,  in  effect  May  25th  of 
that  year,  the  provision  in  reference  to  the  appoint- 


DETERMINATION    OF    SURROGATE.  335 

ment  of  a  guardian  for  an  infant  or  an  incompetent 
was  added  to  section  232. 

By  chapter  173,  Laws  1901,  in  effect  April  1st, 
amended  section  232  by  providing  that  the  fees  of 
the  appraiser  appointed  by  the  justice  of  the  Supreme 
Court  shall  be  $5  per  day,  and  provides  for  a  certified 
copy  of  the  assessment  by  the  justice  to  be  transmitted 
to  the  Surrogate's  Court,  which  was  doubtless  inad- 
vertently omitted  from  the  amendment  of  1899. 

By  chapter  368,  Laws  1905,  in  effect  June  1st  of  that 
year,  a  part  of  the  provisions  of  former  section  232, 
and  relating  to  the  determination  of  the  surrogate  upon 
the  filing  of  the  appraiser's  report,  —  application  to 
Superintendent  of  Insurance  to  compute  the  value  of 
future  and  contingent  estates,  —  the  notice  to  be  given 
to  those  interested  after  the  surrogate  has  fixed  the 
tax,  and  the  provision  in  reference  to  appointing  a 
guardian  for  an  infant  or  an  incompetent,  were  re- 
enacted  in  section  231  of  the  Act  of  1905.  This  sec- 
tion also  contains  a  new  provision,  requiring  the  sur- 
rogate to  forward  a  copy  of  the  taxing  order  to  the 
State  Comptroller,  also  copies  of  all  orders  entered 
by  him  affecting  in  any  way  the  transfer  tax  on  any 
estate,  including  orders  of  exemption. 


CHAPTER  XVII. 


Appeal   to   the   Surrogate  —  Appellate   Division 
Court  of  Appeals. 


414. 
415. 
416. 
417. 

418. 


419. 

420. 

421. 

422. 

423. 

424. 
425. 

426. 

427. 
42S. 

429, 


430 
431 

432 


will 


the 


433. 


Appeal  and  other  proceedings. 

Who  can  appeal. 

Executor's  right  to  appeal. 

Id.;  only  parties  aggrieved, 
however,  may  appeal. 

Id.;  immaterial  whether  tax 
can  be  collected  or  not;  if 
transfer  is  taxable. 

Id;  where  appraiser  refuses 
to  appraise  an  asset. 

Only  remedy  where  debts  are 
not  urged  or  reserved. 

Id.;  to  whom  and  how  per- 
fected. 

Id. :  only  remedy  to  correct 
legal  errors. 

Id.;  where  Comptroller  was 
not  a  party. 

The  order  appealed  from. 

Surrogate    can    construe 
on  appeal  to  him. 

Necessity      of      stating 
grounds  of  the  appeal. 

Object  of  stating  the  grounds 
of  appeal. 

Surrogate  on  appeal  may  re- 
ceive additional  evidence 
and  consider  new  questions 
subsequently  arising. 

May  receive  evidence  that 
transfer  was  made  in  con- 
templation of  death. 

The  surrogate's  discretion. 
Failure  of   surrogate   to  give 
notice;  does  not  effect. 

Accepting  payment  as  per 
order  does  not  effect. 

[336] 


434. 
435. 

436. 

437. 

438. 

439. 

440. 

441. 
442. 


443. 


444, 


445, 


440 


When  order  becomes  final  and 
conclusive. 

Costs  on  appeal. 

When  costs  not  properly  im- 
posed on  moving  party. 

Costs  governed  by  section  3240 
of  the  Code. 

Allowance  of  costs  carries 
with  it  the  disbursements. 

Appeal  to  the  Appellate  Divi- 
sion. 

Appellate  Division  will  only 
consider  the  grounds  of  ap- 
peal. 

When  failure  to  except  to 
ruling  not  a  prerequisite  to 
review. 

Appellate  Division  will  not  in- 
terfere with  surrogate's  re- 
fusal to  direct  a  refund. 

Appeal  to  the  Court  of  Ap- 
peals; matters  in  surro- 
gate's discretion;  not  sub- 
ject to  review. 

Appeal ;  will  be  dismissed, 
when. 

But  an  order  of  reversal  upon 
the  law  and  the  facts  is  re- 
viewable when  no  question 
of  fact  is  involved. 

When  unanimous  decision  of 
the  Appellate  Division  is  re- 
viewable. 

Corresponding  sections  of  for- 
mer acts  relating  to  ap- 
peals. 


RELATING  TO  APPEALS.  337 

414.  Appeal  and  Other  Proceedings. 

[§  232,  Tax  Law.]  The  state  comptroller1  or  any  person 
dissatisfied2  with  the  appraisement  or  assessment  and  deter- 
mination of  tax  may  appeal  therefrom  to  the  surrogate  within 
sixty  days  from  the  fixing,  assessing  and  determination  of 
tax  by  the  surrogate  as  herein  provided,  upon  filing  in  the 
office  of  the  surrogate  a  written  notice  of  appeal,  which  shall 
state  the  grounds  upon  which  the  appeal  is  taken.3 

Within  two  years  after  the  entry  of  an  order  or  decree  of  a 
surrogate  determining  the  value  of  an  estate  and  assessing 
the  tax  thereon,  the  state  comptroller  may,  if  he  believes  that 
such  appraisal,  assessment  or  determination  has  been  fraud- 
ulently, collusively,  or  erroneously  made,  make  application 
to  a  justice  of  the  supreme  court  of  the  judicial  district  in 
which  the  former  owner  of  such  estate  resided,  for  a  reap- 
praisal thereof.  The  justice  to  whom  such  application  is 
made  may  thereupon  appoint  a  competent  person  to  reap- 
praise such  estate.  Such  appraiser  shall  possess  the  powers 
and  be  subject  to  the  duties  of  an  appraiser  under  section  two 
hundred  and  thirty  and  shall  receive  compensation  at  the  rate 
of  five  dollars4  per  day  for  every  day  actually  and  necessarily 
employed  in  such  appraisal.  Such  compensation  shall  be 
payable  by  the  state  comptroller  or  county  treasurer  out  of 
any  funds  he  may  have  on  account  of  any  tax  imposed  under 
the  provisions  of  this  article,  upon  the  certificate  of  the  jus- 
tice appointing  him.  The  report  of  such  appraiser  shall  be 
filed  with  the  justice  by  whom  he  was  appointed,  and  there- 

1.  Chap.  908,  Laws  1896  —  in  effect  June  15  of  that  year. —  Section 
232  first  authorized  the  State  Comptroller  to  appeal  from  the  appraise- 
ment or  assessment  of  tax. 

2.  Chap.  483,  Laws  1885  — in  effect  June  30  of  that  year.— Section 
13  provided  for  appeals  by  any  person  dissatisfied  with  the  appraisement 
or  assessment  on  paying  or  giving  security  to  pay  costs  and  the  tax  that 
shall  he  fixed  hv  the  court. 

3.  Chap.  309,  Laws  1892  — in  effect  May  1  of  that  year.— Section 
13  first  provided  for  filing  written  notice  of  appeal  in  the  office  of  the 
surrogate  and  providing  further  that  the  grounds  of  the  appeal  must  be 
stated  in  said  notice.  This  amendment  repealed  the  provision  as  to  giv- 
ing bonds  for  costs,  etc.,  by  the  appellant. 

4.  Chap.  173,  Laws  190l" — in  effect  April  1  of  that  year. —  Makes  the 
compensation  of  the  appraiser  $5  per  day. 

22 


338  THE   LAW    OF    TAXABLE    TRANSFERS. 

after  the  same  proceedings  shall  be  taken  and  had  by  and 
before  such  justice  as  are  herein  provided  to  be  taken  and 
had  by  and  before  the  surrogate.  The  determination  and 
assessment  of  such  justice  shall  supersede  the  determination 
and  assessment  of  the  surrogate,  and  shall  be  filed  by  such 
justice  in  the  office  of  the  state  comptroller,  and  a  certified 
copy  thereof  transmitted  to  the  surrogate's  court  of  the 
proper  county.5 

415.  Who  Can  Appeal. 

The  State  Comptroller,  or  any  person  dissatisfied 
with  the  appraisement,  or  assessment  and  determina- 
tion of  tax,  may  appeal  therefrom.     (§  232.) 

It  was  held,  in  the  Matter  of  Blackstone,  69  App. 
Div.  127,  that  the  comptroller  of  the  city  of  New  York 
has  authority  to  prosecute  an  appeal  from  an  adverse 
decision  of  the  surrogate  rendered  in  transfer  tax  pro- 
ceedings instituted  by  such  comptroller,  although  the 
powers  and  duties  in  respect  thereto  have  devolved 
upon  the  State  Comptroller.  Affirmed,  171  N.  Y.  682; 
Blackstone  v.  Miller,  188  U.  S.  189. 

In  the  Matter  of  Arnett,  49  Hun,  599,  2  N.  Y.  S.  428, 
it  was  held  that  the  district  attorney  may  appeal  from 
the  decision  of  the  surrogate  on  the  judicial  settlement 
of  the  accounts  of  the  executors,  on  behalf  of  the  peo- 
ple, on  the  ground  that  the  transfer  tax  has  not  been 
imposed  and  paid. 

416.  Executor's  Right  to  Appeal. 

The  executor  as  such  is  entitled  to  appeal  from 
an  order  and  decree  fixing  a  transfer  tax,  as  he  is  made 

5.  Chap.  908,  Laws  1896  —  in  effect  June  15  of  that  year. —  Section 
232  first  contained  this  provision  in  reference  to  reappraisal  where 
former  appraisal  was  erroneously  or  fraudulently  made. 


RELATING  TO  APPEALS.  339 

personally  liable  for  the  tax.  Matter  of  Cornell,  66 
App.  Div.  162-171,  73  N.  Y.  S.  32;  modified  in  other 
respects,  170  N.  Y.  423. 

41 7.  Id. —  Only  Parties  Aggrieved,  However,  May  Appeal. 

Where  the  executor  and  all  the  interested  parties 
under  a  will  have  united  in  submitting  a  question  in 
controversy  to  the  Appellate  Division,  and  none  of 
the  parties  interested  as  legatees  or  remaindermen 
have  appealed  from  its  judgment,  the  executors  have 
no  such  direct  interest  as  will  entitle  them  to  take 
an  appeal  to  the  Court  of  Appeals.  Isham  v.  N.  Y. 
Association  for  Poor,  177  N.  Y.  218. 

418.  Id.— Immaterial  Whether  Tax  Can  be  Collected  or  Not  — 

If  Transfer  is  Taxable. 

Property  should  be  appraised  and  the  transfer  taxed, 
although  it  is  not  apparent  how  the  tax  can  be  col- 
lected, and  where  the  State  Comptroller  appeals  from 
an  order  of  the  Surrogate's  Court  determining  that 
a  part  of  decedent's  estate  was  not  subject  to  a  trans- 
fer tax  because  situated  without  the  State,  and  was 
administered  upon  and  paid  to  foreign  legatees, 
whether  or  not  the  tax  when  assessed  can  be  collected 
is  a  question  in  no  manner  presented  by  such  appeal. 
Matter  of  Dingman,  66  App.  Div.  228,  229,  72  N.  Y.  S. 
694. 

419.  Id. —  Where  Appraiser  Refuses  to  Appraise  an  Asset. 
An  error  by  the  appraiser  refusing  to  appraise  an 

asset  of  the  estate  is  not  a  ground  for  setting  aside 


340        THE  LAW  OF  TAXABLE  TRANSFERS. 

the  appraisal,  but  the  remedy  is  by  appeal.     Matter  of 
Smith,  14  Misc.  Rep.  169,  35  N.  Y.  S.  701. 

420.  Id.—  Only  Kemedy  Where  Debts  Are  not  Urged,  or  Ke- 

served. 

Where  claims  for  deductions  are  not  urged  before 
the  appraiser,  and  no  general  reservation  on  the  sub- 
ject of  claims  was  made  by  him,  the  only  remedy  under 
the  statute  for  an  omission  to  give  proper  credit  for 
debts  is  by  appeal.  Matter  of  Morgan,  36  Misc.  Rep. 
753,  754,  74  N.  Y.  S.  478. 

421 .  Id.—  To  Whom  and  How  Perfected. 

The  appeal  from  the  order  fixing  the  tax  is  to  the 
surrogate,  and  is  perfected  upon  filing  in  the  office  of 
the  surrogate  a  written  notice  of  appeal  within  sixty 
days  from  the  fixing,  assessing,  and  determination  of 
the  tax  by  the  surrogate,  which  said  notice  of  appeal 
shall  state  the  grounds  upon  which  the  appeal  is  taken. 
(§  232.) 

422.  Id.—  Only  Remedy  to  Correct  Legal  Errors. 

It  seems  that  the  only  remedy  for  the  correction  of 
purely  legal  errors  involved  in  the  surrogate's  deter- 
mination is  by  the  appeal  prescribed  in  section  13 
(now  §  232)  of  the  Transfer  Tax  Law.  Morgan  v. 
Cowie,  49  App.  Div.  612,  63  N.  Y.  S.  608.  (Decision, 
Act  1892.) 

423.  Id.—  Where  Comptroller  Was  not  a  Party. 

It  was  held  in  the  Matter  of  Dingman,  66  App.  Div. 
228-231,  72  N.  Y.  S.  694,  that,  where  the  State  Comp- 


RELATING  TO  APPEALS.  341 

troller  was  not  a  party  to  the  proceeding  in  which  the 
order  was  made,  he  had  three  months  from  the  time 
of  the  entry  thereof  in  which  to  take  an  appeal,  as 
provided  by  section  2572  of  the  Code  of  Civil  Pro- 
cedure. 

4-24.  The  Order  Appealed  From. 

Where  the  notice  of  appeal  states  that  it  is  from 
the  order  of  January  24,  1903,  as  resettled  by  order 
of  March  24,  1903,  the  resettled  order  is  the  one  ap- 
pealed from.  Matter  of  Post,  85  App.  Div.  611,  82 
N.  Y.  S.  1079. 

425.  Surrogate  Can  Construe  Will  on  Appeal  to  Him. 

The  construction  of  the  will  of  the  deceased  is  neces- 
sarily involved  in  transfer  tax  proceedings  upon  the 
decedent's  estate.  Matter  of  Peters,  69  App.  Div.  465, 
466,  74  N.  Y.  S.  1028. 

But  a  failure  to  appeal  from  the  surrogate's  decree 
in  the  tax  proceedings  does  not  conclude  the  parties 
interested  as  to  the  same  questions  in  other  proceed- 
ings, as  the  adjudication  of  the  surrogate  in  such  case 
is  limited  to  the  subject  of  taxation.  Matter  of  Vll- 
man,  137  N.  Y.  403,  407,  citing  Matter  of  Wolfe,  137 
N.  Y.  205. 

426.  Necessity  of  Stating  the  Grounds  of  the  Appeal. 
Where  the  statute  requires  the  grounds  of  the  appeal 

to  be  stated,  none  except  those  specified  can  be  con- 
sidered.    Matter  of  Davis,  149  N.  Y.  539-548. 

The  review  of  the  surrogate  on  an  appeal  to  him  is 


342  THE   LAW   OF   TAXABLE   TRANSFERS. 

limited  to  the  items  specified  in  the  notice  of  appeal. 
Matter  of  Wormser,  51  App.  Div.  441,  64  N.  Y.  S.  897. 

427.  Object  of  Stating  the  Grounds  of  Appeal. 

The  purpose  of  requiring  the  notice  of  appeal  to  the 
surrogate  to  state  the  grounds  the  appeal  is  made 
upon  was  to  limit  the  questions  to  be  reviewed  by  him 
to  those  only  stated  in  the  notice,  and  neither  the  Su- 
preme Court  nor  the  Court  of  Appeals  can  review  any 
question  except  that  reviewed  by  the  surrogate.  Mat- 
ter of  Manning,  169  N.  Y.  449-452. 

428.  Surrogate,  on  Appeal,  May  Receive  Additional  Evidence 

and  Consider  New  Questions  Subsequently  Arising. 

Upon  the  hearing  on  an  appeal  to  the  surrogate  from 
an  order  confirming  the  appraiser's  report,  the  surro- 
gate may,  in  his  discretion,  receive  evidence  upon  the 
questions  involved.  In  the  Matter  of  Westum,  152 
N.  Y.  93-104,  the  court  says :  "We  think  the  statute 
ought  to  be  construed  so  as  to  permit  the  raising,  upon 
an  appeal,  of  a  question  which  did  not  enter  into  the 
original  determination,  and  which  was  first  made 
known  after  the  appeal  had  been  taken  and  after  the 
expiration  of  the  sixty  days.  The  surrogate  had 
jurisdiction  of  the  appeal  by  the  notice  actually  given, 
and  it  would  be  an  unwise  construction  of  the  act  to 
limit  the  hearing  so  as  to  exclude  the  consideration  of 
a  new  question,  subsequently  arising,  on  the  ground 
that  it  was  not  specified  in  the  notice  of  appeal." 
(Decision,  Act  1892.)  See  also  Matter  of  Bentley,  31 
Misc.  Rep.  656,  66  N.  Y.  S.  95. 


RELATING  TO  APPEALS.  343 

429.  May  Receive  Evidence  that  Transfer  Was  Made  in  Con- 

templation of  Death. 

It  lies  in  the  power  of  the  surrogate,  upon  an  appeal 
to  him  from  an  order  confirming  the  report  of  the  ap- 
praisers and  determining  the  amount  of  the  transfer 
tax,  to  receive  proof  that  a  transfer  of  property  made 
by  the  decedent  was  made  in  contemplation  of  death, 
and  hence  was  taxable.  Matter  of  Thompson,  57  App. 
Div.  317,  68  N.  Y.  S.  18. 

430.  The  Surrogate's  Discretion. 

It  is  within  the  discretion  of  the  court  to  permit  the 
introduction  of  additional  proof  upon  the  appeal  to 
him.  Matter  of  Kelly,  29  Misc.  Rep.  169,  170,  60  N.  Y. 
S.  1005. 

In  the  Matter  of  Thompson,  57  App.  Div.  317,  68 
N.  Y.  S.  18,  the  Appellate  Division  says :  ' '  The  whole 
matter  is  with  the  surrogate  and  continues  with  him 
until  the  final  determination  after  appeal.  The  pur- 
pose of  the  appeal  from  the  surrogate  to  the  surrogate 
is  not  simply  to  review  his  former  determination. 
There  is  no  occasion  to  limit  it  to  that.  The  beneficial 
results  of  such  a  rehearing  would  be  greatly  dimin- 
ished if  the  determination  of  the  surrogate  could  not 
at  that  time  be  treated  as  so  far  open  as  to  admit  new 
testimony. ' ' 

431.  Failure  of  Surrogate  to  Give  Notice  —  Does  not  Effect. 
An  appeal  from  the  determination  of  the  surrogate 

must  be  taken  within  sixty  days  from  the  time  when 
it  was  made,  whether  or  not  the  surrogate  has  per- 
formed his  statutory  duty  of  immediately  giving  no- 


344  THE   LAW    OF    TAXABLE    TRANSFERS. 

tice  to  all  persons  known  to  be  interested  in  the  estate 
of  the  tax  imposed  thereon.  Matter  of  Connelly,  38 
Misc.  Rep.  466-470,  77  N.  Y.  S.  1032. 

432.  Accepting  Payment  as  Per  Order  —  Does  not  Effect. 

The  receipt  by  the  comptroller  of  the  city  of  New 
York  of  the  transfer  tax  ordered  to  be  paid  on  a  life 
estate  does  not  estop  him  from  appealing  from  so 
much  of  the  order  as  declares  that  a  vested  remainder, 
after  the  life  estate,  "  is  at  present  undeterminable  and 
is  now  not  subject  to  tax."  Matter  of  Bogert,  25  Misc. 
Rep.  466,  55  N.  Y.  S.  751,  following  Matter  of  Lange, 
N.  Y.  Law  Journal  of  Oct.  26,  1895. 

433.  When  Order  Becomes  Final  and  Conclusiv«. 

Where  no  appeal  was  taken  from  the  surrogate's 
order  fixing  the  tax,  the  surrogate's  determination  as 
expressed  by  that  order  must  be  regarded  as  final  and 
conclusive  upon  all  the  questions,  both  of  law  and  of 
fact,  then  presented  to  him  for  adjudication.  Matter 
of  Lansing,  31  Misc.  Rep.  148-154,  64  N.  Y.  S.  1125; 
Matter  of  Schermerhom,  38  App.  Div.  350,  57  N.  Y.  S. 
26. 

The  order  fixing  the  tax  on  the  basis  of  the  original 
appraisal,  is  conclusive  upon  such  matters  until  it  is 
reversed  or  modified.  Matter  of  Rice,  56  App.  Div. 
253,  61  N.  Y.  S.  911,  68  N.  Y.  S.  1147. 

434.  Costs  on  Appeal. 

The  allowance  of  costs  to  the  Comptroller  on  appeal 
to  the  surrogate  is  within  the  sound  discretion  of  the 
surrogate,  and   should  not  be  disturbed   except  for 


RELATING  TO  APPEALS.  345 

sufficient  cause.     Matter  of  Hoffman,  76  Hun,  399,  27 
N.  Y.  S.  1086. 

435.  When  Costs  not  Properly  Imposed  on  Moving  Party. 

Where  an  order  exempting  an  estate  had  been  made 
on  an  ex  parte  application  by  the  representatives  of 
the  estate,  and  the  State  Comptroller  moved  to  vacate 
such  order  upon  affidavits  which  were  not  controverted, 
—  held,  that  costs  should  not  be  imposed  upon  the 
moving  party  by  an  order  denying  the  motion,  where 
counsel  for  the  administrator  with  the  will  annexed 
appeared  and  made  no  opposition  to  the  Comptroller's 
application  to  vacate  the  order  of  exemption.  Matter 
of  CoWms,  104  App.  Div.  184. 

436.  Costs  Governed  by  Section  3240  of  the  Code. 

Costs  upon  an  appeal  from  a  surrogate's  decree  va- 
cating a  transfer  tax  assessment  are  governed  by  sec- 
tion 3240  of  the  Code  of  Civil  Procedure. 

If  the  appellate  court  awards  costs,  such  costs  are, 
by  express  provision  of  the  section,  allowable  at  the 
rates  allowed  upon  an  appeal  from  a  judgment,  and  in 
the  same  manner.  Matter  of  Babcock,  86  App.  Div. 
563,  83  N.  Y.  S.  1020. 

437.  Allowance  of  Costs  Carries  With  it  the  Disbursements. 
The  order  of  the  appellate  court  need  not  specify 

that  disbursements  as  well  as  costs  were  allowed,  as, 
under  section  3256  of  the  Code  of  Civil  Procedure,  the 
award  of  costs  carries  with  it  an  allowance  of  the  dis^ 
bursements  specified  in  such  action.  Matter  of  Bab- 
cock, 86  App.  Div.  563,  83  N.  Y.  S.  1020. 


3-tG  THE   LAW    OF    TAXABLE    TRANSFERS. 

438.  Appeal  to  the  Appellate  Division. 

Under  section  1351  of  the  Code  of  Civil  Procedure 
an  appeal  authorized  by  this  title  must  be  taken  within 
thirty  days  after  service  upon  the  attorney  for  the 
appellant  of  a  copy  of  the  judgment  or  order  appealed 
from,  and  a  written  notice  of  the  entry  thereof.  The 
period  of  limitation  does  not  begin  to  run  until  the 
prevailing  party  serves  the  necessary  papers  upon 
the  attorney  for  his  adversary.  McGruer  v.  Abbott, 
47  App.  Div.  191,  62  N.  Y.  S.  123. 

It  was  held  in  the  above  case  that  service  of  such 
papers  by  the  defeated  party  upon  the  prevailing 
party,  and  a  written  admission  of  such  service  by  the 
latter,  do  not  start  the  period  of  limitation  running. 

439.  Appellate  Division  Will  Only  Consider  the  Grounds  of 

Appeal. 

Under  section  232  of  the  Tax  Law,  as  amended  by 
chapter  173,  Laws  1901,  which  provides  that  the  notice 
of  appeal  to  a  surrogate  from  a  determination  fixing 
the  amount  of  a  transfer  tax  shall  state  the  grounds 
upon  which  the  appeal  is  taken,  the  Appellate  Division 
is  confined  to  a  consideration  of  those  grounds  upon 
an  appeal  from  the  surrogate's  decree.  Matter  of 
Kennedy,  93  App.  Div.  27 ;  Miller  v.  Tracy,  86  N.  Y.  S. 
1024. 

440.  When  Failure  to  Except  to  Ruling  not  a  Prerequisite  to 

Review. 

Where  it  is  apparent  that  the  ruling  excluding  evi- 
dence may  have  been  very  prejudicial  to  the  appellant, 
the  court  will  not  insist  upon  an  exception  thereto  as  a 


RELATING  TO  APPEALS.  347 

prerequisite  to  a  review.    Matter  of  Brundage,  31  App. 
Div.  348,  52  N.  Y.  S.  362. 

441.  Appellate  Division  Will  not  Interfere  with  Surrogate's 

Refusal  to  Direct  a  Refund. 

Where  the  surrogate  refused  to  insert  in  the  order 
vacating  the  transfer  tax  imposed  upon  the  estate,  a 
direction  to  refund  the  amount  of  the  tax,  the  court 
says :  ' '  We  do  not  think  we  ought  to  interfere  with 
the  surrogate's  refusal  to  insert  in  the  order  a  direc- 
tion to  the  State  Comptroller  to  refund  the  amount  of 
tax.  Such  provisions  are  common  in  orders  of  this 
kind,  and  orders  containing  them  frequently  have  been 
affirmed  by  this  court  and  the  Court  of  Appeals. 
(Matter  of  Silliman,  79  App.  Div.  98;  affd.,  175  N.  Y. 
513;  Matter  of  Scrimgeour,  80  App.  Div.  388;  affd.,  175 
N.  Y.  507.)  *  *  *  It  is  not  at  all  essential,  however, 
to  the  preservation  or  enforcement  of  the  rights  of  the 
party  entitled  to  such  repayment."  Matter  of  Cam- 
eron, 97  App.  Div.  436,  437,  89  N.  Y.  S.  977;  affd.,  181 
N.  Y.  Mem.  49. 

442.  Appeal  to  the  Court  of  Appeals  —  Matters  in  Surrogate's 

Discretion  —  Not  Subject  to  Review. 

Where  appellants  appeal  to  the  Appellate  Division 
from  so  much  of  the  surrogate 's  decree  as  reduced  the 
interest  on  the  unpaid  tax  from  10  to  6  per  cent.,  and 
have  appealed  to  the  Court  of  Appeals  from  the  affirm- 
ance by  the  Appellate  Division  of  this  provision,  the 
court  holds  that  on  this  record  the  matter  rested  in 
the  discretion  of  the  surrogate,  and  that  said  court  is 


348        THE  LAW  OF  TAXABLE  TRANSFERS. 

not  justified  in  interfering  with  its  exercise.     Matter 
of  Cornell,  170  N.  Y.  423-426. 

443.  Appeal  —  Will  be  Dismissed,  When. 

The  Court  of  Appeals  has  no  power  to  review  deci- 
sion of  Appellate  Division  reversing  surrogate  upon 
the  facts. 

A  question  of  fact  which  the  Court  of  Appeals  has 
no  jurisdiction  to  review  is  involved  upon  an  appeal 
from  an  order  of  the  Appellate  Division,  reversing 
"  upon  the  facts  and  the  law  "  a  decree  of  the  Surro- 
gate's Court,  confirming  the  appraiser's  report  levy- 
ing a  transfer  tax,  where  the  surrogate  rejected,  and 
the  Appellate  Division  accepted,  the  version  of  the 
beneficiary's  story  most  favorable  to  herself.  Matter 
of  Thome,  162  N.  Y.  238,  dismissing  appeal  from  44 
App.  Div.  8,  60  N.  Y.  S.  419. 

444.  But  an  Order  of  Reversal  Upon  the  Law  and  the  Facts, 

is  Reviewable  When  no  Question  of  Fact  is  Involved. 

Upon  an  appeal  from  an  order  of  the  Appellate  Di- 
vision reversing  a  surrogate's  decree,  upon  the  law 
and  the  facts,  where  the  influences  from  the  uncontra- 
dicted evidence  all  point  in  one  direction,  so  that  a 
reasonable  mind  can  reach  but  one  conclusion,  there 
is  no  question  of  fact,  and  the  Court  of  Appeals  has 
jurisdiction  of  the  appeal.  Matter  of  Totten,  179 
N.  Y.  112-116. 

445.  When  Unanimous  Decision  of  the  Appellate  Division  is 

Reviewable. 

The  provision  of  the  Constitution  (art,  6,  §  9)  and 
of  the  Code  of  Civil  Procedure  (§  191),  that  no  unani- 


RELATING  TO  APPEALS.  349 

mous  decision  of  the  Appellate  Division  of  the  Su- 
preme Court  that  there  is  evidence  supporting  a  find- 
ing of  fact  shall  be  reviewed  by  the  Court  of  Appeals, 
has  no  application  to  an  appeal  from  an  order  of  the 
Appellate  Division,  affirming  an  order  of  a  surrogate 
reversing  the  imposition  of  a  transfer  tax  where  no 
question  of  fact  was  in  controversy,  and  the  only  ques- 
tion involved  was  the  legal  construction  of  the  instru- 
ment of  transfer  and  the  statute.  Matter  of  Green, 
153  N.  Y.  223. 

446.  Corresponding    Sections    of    Former    Acts    Relating    to 
Appeals. 

Section  13  of  the  Act  of  1885  provided  for  appeals 
to  the  surrogate  from  the  taxing  order  by  any  person 
dissatisfied  with  the  appraisement  or  assessment,  on 
paying  or  giving  security  to  pay  all  costs,  together  with 
whatever  tax  shall  be  fixed  by  the  court.  This  pro- 
vision was  re-enacted  by  chapter  399,  Laws  1892  (§13), 
in  effect  May  1st  of  that  year,  except  that  the  provision 
in  reference  to  paying  or  giving  security  for  costs  was 
omitted,  and  a  new  provision  added  requiring  the  ap- 
pellant to  state  his  grounds  of  appeal.  Section  13  of 
the  Act  of  1892  became  section  232  of  the  Act  of  1896, 
in  effect  June  15th  of  that  year,  and  re-enacted  the 
provisions  in  reference  to  appeals,  giving  "  the  Comp- 
troller of  the  State  of  New  York  "  also  the  right  to 
appeal. 

This  provision  was  substantially  re-enacted  by  chap- 
ter 368,  Laws  1905  (§  232),  in  effect  June  1st  of  that 
year. 


350  THE   LAW    OF    TAXABLE    TRANSFERS. 

Application  to  justice  of  Supreme  Court  for  reap- 
praisal. This  provision  first  appeared  in  section  232 
of  chapter  908,  Laws  1896,  in  effect  June  15th  of  that 
year,  and  was  re-enacted  as  a  part  of  section  232  of 
chapter  368,  Laws  1905. 

Further  reference  to  the  provision  of  §  232  of  the  Tax  Law,  see 
chapter  XVIII,  Modification  of  Orders. — Reappraisal. 


CHAPTER  XVIII. 


Modification  of  Orders  —  Reappraisal. 

(§  232  Tax  Law.) 


447.  Surrogate's   power   to  modify 

decree. 

448.  Decree  vacated   when   statute 

unconstitutional. 

449.  Order  modified,  although  time 

to  appeal  has  expired. 

450.  When    surrogate    can    modify 

his  decree. 

451.  Finality     of     surrogate's     de- 

termination. 

452.  Surrogate's    power    to    decree 

previous  order  erroneous. 

453.  Surrogate's  power  under  subd. 

6,  sec.  2481  of  the  Code. 

454.  Decree  not   opened   to  correct 

an  error  of  law. 

455.  Decree  modified;   where  lega- 

tee   not    notified    of    surro- 
gate's determination. 

456.  When  surrogate  cannot  grant 

relief  in  regard  to  debts. 

457.  Correction  of  order  refused. 


458.  Surrogate    has    no    power    to 

modify   order    on    ex   parte 
application. 

459.  When    surrogate    may    vacate 

his  order. 

460.  Reappraisal;      provision      ap- 

plies only  to  errors  of  fact. 

461.  Reappraisal;     when     not     en- 

titled to. 

462.  Rehearing;  when  refused.      % 

463.  Improper  to  raise   values   on 

reappraisal. 

464.  Conclusiveness  of  an  appraisal. 

465.  Corrections. 

466.  When  order  will  be  tet  aside. 

467.  The  Supreme  Court  cannot  va- 

cate order  for  reappraisal. 

468.  The    Comptroller    may    either 

apply   for   a   reappraisal   or 
appeal. 

469.  Supreme     Court     at     Special 

Term  will  not  review  surro- 
gate's discretion. 


447.  Surrogate's  Power  to  Modify  Decree. 

A  surrogate  has  no  power  to  modify  a  decree  of  ap- 
praisal under  the  Transfer  Tax  Law  on  the  ground 
that  a  sale  of  the  property  subsequent  to  the  appraisal 
showed  that  the  latter  was  too  high.  In  the  Matter 
of  Lowry,  89  App.  Div.  226,  85  N.  Y.  S.  924,  it  appears 
that,  upon  the  appraisal  of  this  decedent's  real  estate, 
its  value  was  fixed  at  $200,000  —  one  of  the  trustees 
under  the  will,  who  was  acquainted  with  the  values  of 

[351 J 


352        THE  LAW  OF  TAXABLE  TRANSFERS. 

real  estate  in  the  locality  where  this  real  estate  was 
situated  sufficiently  to  qualify  him  as  an  expert,  testify 
ing  to  such  value.  A  few  months  afterward  the  real 
estate  in  question  was  sold  fairly  and  in  good  faith  at 
public  auction  for  $103,050.  The  surrogate  thereafter 
modified  the  original  order  and  report  of  the  appraiser 
by  reducing  the  value  of  this  real  estate  to  about  the 
figure  at  which  it  was  sold,  holding  that  a  "  mistake 
of  fact  ' '  had  been  made  in  fixing  the  value. 

The  Appellate  Division  reversed  the  order  of  the 
surrogate  modifying  the  original  order,  and  says: 
"  Under  the  Transfer  Tax  Law  the  surrogate  may  do 
any  act  in  relation  to  such  a  tax  '  authorized  by  law 
to  be  done  by  a  surrogate  in  other  matters  or  proceed- 
ings coming  within  his  jurisdiction.'  (§  229,  now  §  228.) 
(See  §  2481,  Code,  subd.  6.)  This  includes  the  power 
to  modify  or  set  aside  a  decree  for  error  in  fact  not 
arising  upon  the  trial.  (Code,  §  1283.)  In  Morgan  v. 
Cowie,  49  App.  Div.  612,  63  N.  Y.  S.  608,  it  was  held: 
'  The  authority  of  a  court  to  modify  its  own  decree 
for  an  error  in  fact,  newly-discovered  evidence,  or  any 
cause  extrinsic  of  the  record,  is  an  inherent  one,  and 
is  vested  in  every  court,  with  such  restrictions  as  the 
Legislature  has  seen  fit  to  impose.'  " 

Held,  that  an  error  of  fact  of  this  kind,  provable  as 
such  only  by  subsequently-occurring  facts,  must  be 
deemed  to  be  an  error  arising  upon  a  trial,  and  hence 
not  within  the  purview  of  section  1283  of  the  Code,  as 
made  applicable  to  Surrogates'  Courts  by  section  2481. 

"A  practice  which  would  permit  judgments  fixing 
values  to  be  opened  from  time  to  time  in  cases  where 
a  subsequent  sale  of  the  appraised  property  tended  to 


MODIFICATION   OF   ORDERS.  353 

show  that  the  figure  fixed  by  the  judgment  was  too 
large  or  too  small,  would  lead  to  intolerable  uncer- 
tainty and  confusion.  *  *  *  In  no  view  was  this 
proof  in  regard  to  the  sale  newly-discovered  evidence 
such  as  the  Code  contemplates  as  the  basis  for  setting 
aside  a  judgment." 

Morgan  v.  Cowie  (supra)  criticised  and  distin- 
guished where  the  court,  speaking  of  the  jurisdiction 
of  the  Surrogate's  Court  in  transfer  tax  cases,  says: 
"  If  facts  have  arisen  since  the  imposition  and  pay- 
ment of  the  tax  showing  it  was  improperly  assessed 
or  excessive  in  amount,  or  within  the  jurisdiction  of 
the  court  to  tax,  then  the  court  possesses  the  power 
to  redress  the  wrong  done."  Matter  of  Fulton,  30 
Misc.  Rep.  70,  62  N.  Y.  S.  995,  also  criticised. 

448.  Decree  Vacated  —  Where  Statute  Unconstitutional. 

Where  both  parties  mistakenly  supposed  that  the 
estate  was,  under  the  law,  subject  to  a  transfer  tax, 
and  the  proposition  was  not  litigated  or  decided,  and 
it  subsequently  appears  that  the  statute  under  which 
the  surrogate  assessed  the  tax  was  unconstitutional, 
the  surrogate  has  power,  under  subdivision  6  of  sec- 
tion 2481  of  the  Code  of  Civil  Procedure,  and  section 
229  of  the  Tax  Law  (now  §  228),  to  vacate  the  appeal, 
although  the  time  to  appeal  therefrom  has  expired. 
Matter  of  Scrimgeour,  175  N.  Y.  507,  affg.  80  App. 
Div.  388,  80  N.  Y.  S.  636. 

449.  Order  Modified,  Although  Time  to  Appeal  has  Expired. 

A  transfer  of  United  States  bonds  given  by  a  spe- 
cific legacy  is  not  taxable  under  chapter  399,  Laws 
23 


354  THE    LAW    OF    TAXABLE    TRANSFERS. 

1892,  and,  although  the  time  to  appeal  from  an  order 
imposing  such  a  tax  has  expired,  the  surrogate  has 
power,  under  the  tax  laws,  to  modify  his  order  and 
direct  the  tax  to  be  refunded,  as  its  original  imposition 
was  without  jurisdiction.  Matter  of  Coogan,  27  Misc. 
Eep.  563,  59  N.  Y.  S.  Ill;  affd.,  162  N.  Y.  613. 

This  decision  was  prior  to  chapter  382,  Laws  1900, 
amending  section  225,  requiring  the  order  to  be  modi- 
fied or  reversed  within  two  years  from  the  entry  of  the 
order  fixing  tax.  See  Matter  of  Hoople,  179  N.  Y.  308. 
Also  ante,  page   211. 

450.  When  Surrogate  Can  Modify  His  Decree. 

The  court  held  in  the  Matter  of  Silliman,  79  App. 
Div.  98 ;  affd.,  175  N.  Y.  513,  that  the  surrogate  could 
modify  his  order  assessing  the  tax  by  deducting  the 
commissions  of  executors,  even  where,  after  the  pay- 
ment of  the  tax,  their  commissions  were  increased  by 
the  conversion  of  real  into  personal  property,  and  also 
where  the  executor's  commissions  as  trustee  had  not 
been  deducted,  although  the  time  to  appeal  had  expired. 
Citing  Matter  of  Coogan  (supra),  also  Morgan  v. 
Cowie,  49  App.  Div.  612,  63  N.  Y.  S.  608. 

451.  Finality  of  Surrogate's  Determination. 

Where  a  surrogate  has  determined  the  cash  value 
of  an  estate  he  has  no  power  to  modify  his  determina- 
tion in  order  to  allow  the  executor  the  amount  of  a 
judgment  subsequently  recovered  against  the  estate  by 
suit  after  he  had  rejected  the  claim.  Matter  of  Con- 
nelly, 38  Misc.  Eep.  466,  77  N.  Y.  S.  1032. 


MODIFICATION    OF   ORDERS.  355 

452.  Surrogate's  Power  to  Decree  Previous  Order  Erroneous. 
A  surrogate  has  no  power  to  make  an  order  decree- 
ing that  an  order  of  appraisal  made  in  a  transfer  tax 
proceeding,  and  which  has  remained  unreversed,  was 
erroneous  in  certain  respects  and  that  a  payment,  in 
pursuance  thereof,  of  the  transfer  tax  so  assessed,  so 
far  as  it  related  to  certain  securities,  was  made  in 
error.  Matter  of  Schermerhorn,  38  App.  Div.  350,  57 
N.  Y.  S.  26. 

453.  Surrogate's  Power  Under  Subdivision  6,  Section  2481  of 

the  Code. 

A  surrogate  has  power,  under  subdivision  6  of  sec- 
tion 2481  of  the  Code  of  Civil  Procedure,  to  modify  an 
order  fixing  the  transfer  tax  upon  an  estate  after  the 
time  to  appeal  therefrom  has  expired,  where  it  is  shown 
that  certain  legacies,  upon  which  a  5-per  cent,  tax  was 
imposed,  had  lapsed  by  the  death  of  the  legatees  prior 
to  that  of  the  testator,  and  passed  to  testator's  widow, 
in  whose  hands  they  were  taxable  at  only  1  per  cent. 
Morgan  v.  Cowie,  49  App.  Div.  612,  63  N.  Y.  S.  608. 

454.  Decree  not  Opened  to  Correct  an  Error  of  Law. 

A  decree  of  the  surrogate  cannot  be  opened  to  cor- 
rect an  error  of  law  made  in  calculating  executors' 
commissions,  and  the  remedy  is  by  an  appeal  from  the 
decree.  If  the  surrogate  erred  in  allowing  the  com- 
missions objected  to,  the  error  was  one  of  law  and  not 
a  clerical  mistake.  Matter  of  Monteith,  27  Misc.  Rep. 
163,  58  N.  Y.  S.  379. 

A  surrogate  is  given  no  power  by  the  statute  (Code 
Civ.  Proc,  §  2481,  subd.  6)  to  open  a  decree  assessing 


356        THE  LAW  OF  TAXABLE  TRANSFERS. 

the  transfer  tax,  for  errors  of  law  nor  for  material 
errors  of  fact  made  as  alleged  in  appraising  firm  assets 
too  high,  and  in  not  making  a  sufficient  deduction  for 
firm  debts.  Matter  of  Wallace,  28  Misc.  Rep.  603,  59 
N.  Y.  S.  1084. 

455.  Decree  Modified  —  Where  Legatee  not  Notified  of  Sur- 

rogate's Determination. 

Although  a  legatee,  exempt  by  law  from  taxation, 
has  been  duly  notified  of  the  time  and  place  of  the  ap- 
praisal of  the  estate  of  the  decedent  who  gave  the 
legacy,  and  failed  to  appear,  yet  where  the  legatee  has 
not  been  subsequently  notified  by  the  surrogate,  as  re- 
quired by  section  232  of  the  Tax  Law,  of  his  determina- 
tion of  the  taxable  value  of  the  legacy,  the  surrogate 
may,  in  the  absence  of  laches,  entertain,  in  his  discre- 
tion, an  application  made  more  than  sixty  days  subse- 
quent to  the  decree,  to  modify  it,  and  may  thereupon 
exempt  the  legatee  from  the  transfer  tax.  Matter  of 
Daly,  34  Misc.  Rep.  148,  69  N.  Y.  S.  494. 

456.  When  Surrogate  Cannot  Grant  Relief  in  Eegard  to  Debts. 
Where,  at  a  transfer  tax  appraisal,  alleged  deduct- 
ible debts  of  a  decedent  have  not  been  urged  before  the 
appraiser,  nor  reserved  for  future  action,  as  they  may 
be  in  a  proper  case,  and  the  time  for  an  appeal  from 
the  order  fixing  the  tax  has  expired,  the  surrogate  is 
without  jurisdiction  to  grant  any  relief  in  regard  to 
said  debts.  Matter  of  Morgan,  36  Misc.  Rep.  753,  74 
N.  Y.  S.  478. 

In  the  Matter  of  Hamilton,  41  Misc.  Rep.  268,  84  N. 
Y.  S.  44,  the  court  held  that  where  no  appeal  has  been 


MODIFICATION    OF   ORDERS.  357 

taken  in  time  from  an  order  fixing  the  transfer  tax,  the 
surrogate  has  no  power  to  modify  his  order  and  allow 
the  executor  a  partial  refund  of  the  tax  for  a  debt  of 
the  estate  subsequently  discovered. 

It  would  seem  that  section  225  of  the  Transfer  Tax 
Law  makes  express  provisions  for  a  refund  where 
there  are  debts  subsequently  discovered  which  were 
not  considered  on  the  appraisal,  or  passed  upon  by  the 
surrogate  when  the  order  was  entered  fixing  the  tax. 

457.  Correction  of  Order  Refused. 

A  surrogate  has  no  power  to  amend  and  correct  an 
order  by  which  a  transfer  tax  was  assessed  upon  a  life 
interest  in  United  States  bonds,  which  were  subse- 
quently disclosed  by  the  Court  of  Appeals  to  be  exempt 
from  taxation,  especially  where  the  tax  was  paid 
voluntarily  and  deliberately,  more  than  five  years  ago, 
under  a  mistake  of  law.  Matter  of  Von  Post,  35  Misc. 
Rep.  367,  71  N.  Y.  S.  1039. 

458.  Surrogate  Has  no  Power  to  Modify  Order  on  Ex  Parte 

Application. 

A  surrogate  has  no  power  to  modify  ex  parte  an 
order  assessing  the  transfer  tax  and  permit  the  ap- 
praisal to  be  opened,  in  order  that  the  executor  may 
show  that  certain  securities  of  his  testator  have  been 
appraised  higher  than  their  actual  market  value.  Mat- 
ter of  Fulton,  30  Misc.  Rep.  70,  62  N.  Y.  S.  995.  The 
syllabus  in  this  case  wrongly  states  that  the  surrogate 
has  such  power.  Citing  Matter  of  Schermerhom,  38 
App.  Div.  350,  57  N.  Y.  S.  26. 


358  THE   LAW   OF   TAXABLE   TRANSFERS. 

4-59.  When  Surrogate  May  Vacate  His  Order. 

Where  the  surrogate  has  by  order  confirmed  the  ap- 
praiser's report  without  noticing  that  it  is  defective, 
he  has  authority  to  vacate  his  order  of  confirmation 
and  send  the  report  back  to  the  appraisers  for  cor- 
rection. Matter  of  Earle,  74  App.  Div.  458,  77  N.  Y.  S. 
503. 

460.  Reappraisal  —  Provision  Applies  Only  to  Errors  of  Fact. 

The  provision  of  the  Tax  Law  authorizing  the  State 
Comptroller  to  apply  within  two  years  from  the  entry 
of  an  order  or  decree  fixing  the  transfer  tax,  for  a  new 
appraisal  if  he  believes  that  the  first  appraisal  was 
fraudulently,  collusively,  or  erroneously  made,  apply 
only  to  errors  of  fact,  and  where  such  a  decree  has 
erroneously  determined,  as  matter  of  law,  that  a  be- 
quest made  to  an  executor  for  his  services  to  the 
testatrix  is  exempt,  the  Comptroller  cannot  procure  a 
new  appraisal.  His  sole  remedy  in  such  a  case  is  by 
an  appeal.  Matter  of  Niven,  29  Misc.  Rep.  550,  61  N. 
Y.  S.  956. 

461.  Reappraisals  —  When  not  Entitled  to. 

Reappraisals  will  not  be  ordered  on  the  motion  of 
the  State  Comptroller  upon  the  ground  that  since  it 
was  appraised  the  property  has  sold  for  a  larger  sum 
than  it  was  valued  at.  Matter  of  Bruce,  59  N.  Y.  S. 
1083. 

462.  Rehearing,  When  Refused. 

A  rehearing  of  an  appraisal  for  the  transfer  tax  will 
not  be  granted  the  State  Comptroller  upon  the  conten- 


REAPPRAISALS.  359 

tion  that  stocks  of  the  estate,  having  no  market  or 
quoted  value,  have  been  appraised  too  low,  unless  he 
produces  some  definite  evidence  tending  to  show  that 
the  proof  on  a  rehearing  will  increase  the  valuation. 
Matter  of  Johnson,  37  Misc.  Rep.  542,  75  N.  Y.  S.  1046. 

463.  Improper  to  Raise  Values  on  Reappraisal. 

On  an  application  for  a  new  appraisal,  the  appraiser 
is  not  authorized  to  appraise  property  included  in  the 
original  appraisal  at  a  higher  valuation  nor  to  reduce 
the  allowance  made  upon  the  first  appraisal  for  debts 
due  by  decedent  and  for  administration  expenses,  al- 
though some  of  such  alleged  debts  have  been  success- 
fully disputed  by  the  executors,  and  the  expenses  of 
administration  have  proved  less  than  was  estimated. 
Matter  of  Rice,  56  App.  Div.  253,  68  N.  Y.  S.  1147. 

464.  Conclusiveness  of  an  Appraisal. 

The  surrogate  has  no  power  nearly  six  years  after 
the  entry  of  the  order  which  was  not  appealed  from, 
to  amend  it  so  as  to  conform  to  the  appraiser's  report, 
nor  can  he  grant  an  order  directing  an  appraisal  of 
personal  property  which  was  in  the  hands  of  the  exec- 
utors at  the  time  the  first  appraisal  was  made,  especi- 
ally where  it  appears  that  such  personal  property  was 
brought  to  the  attention  of  the  appraiser,  and  that  he 
held  that  it  was  not  subject  to  the  tax.  Matter  of 
Crerar,  56  App.  Div.  479,  67  N.  Y.  S.  795. 

465.  Corrections. 

Where  the  time  to  appeal  from  a  decree  assessing 
the  transfer  tax  has  expired,  the  Surrogate's  Court 


360        THE  LAW  OF  TAXABLE  TRANSFERS. 

cannot  modify  the  decree  to  correct  an  error  of  law  in 
accordance  with  a  subsequent  decision  of  the  Court  of 
Appeals.  Matter  of  Silliman,  38  Misc.  Rep.  466,  77  N. 
Y.  S.  1032;  affd.,  79  App.  Div.  98,  80  N.  Y.  S.  336,  175 
N.  Y.  513. 

466.  When  Order  Will  be  Set  Aside. 

Where  it  appears  without  contradiction  that  the  tax 
assessed  upon  moneys  of  an  estate  was  assessed  upon 
the  proceeds  of  sale  of  an  interest  of  the  decedent  in 
real  estate  and  therefore  not  taxable,  the  surrogate 
can  set  aside  the  order  imposing  the  tax,  and  it  is  not 
necessary  that  the  matter  be  sent  back  to  the  official 
appraiser.  Matter  of  Cameron,  97  App.  Div.  436,  89 
N.  Y.  S.  979;  affd.,  181  N.  Y.  Mem.  58,  no  opinion. 

467.  The  Supreme  Court  Cannot  Vacate  Order  for  Reappraisal. 

The  Supreme  Court  has  no  power  to  vacate  an  order 
made  by  a  justice  of  that  court,  directing  a  reappraisal 
of  the  estate  of  a  decedent  for  the  purpose  of  assessing 
the  transfer  tax  thereon.  Matter  of  Smith,  40  App. 
Div.  480,  58  N.  Y.  S.  128. 

468.  The  Comptroller  May  Either  Apply  for  a  Reappraisal  or 

Appeal. 

The  provisions  in  the  Transfer  Tax  Law  for  a  re- 
appraisal under  the  order  of  a  justice  of  the  Supreme 
Court  was  made  by  an  amendment  to  the  statute  in 
1896,  and  it  was  not  intended  to  take  the  place  of  the 
ordinary  appeal  as  provided  by  this  statute,  but  is  <m 
additional  right  given  the  State  Comptroller  in  certain 


REVIEWING   SURROGATE'S   DISCRETION.  361 

cases.    Morgan  v.  Warner,  45  App.  Div.  424,  60  N.  Y. 
S.  963;  affd.,  162  N.  Y.  612. 

469.  The  Supreme  Court,  at  Special  Term,  Will  not  Review 
Surrogate's  Discretion. 

The  Supreme  Court,  at  Special  Term,  will  not  review 
the  judicial  discretion  of  the  surrogate,  where,  upon 
application  to  him,  upon  a  petition  in  transfer  tax 
proceedings,  the  surrogate  holds  that  the  petition  does 
not  state  sufficient  facts  to  show  that  the  estate  is  sub- 
ject to  taxation ;  if  the  petitioner  feels  aggrieved,  then 
he  may  review,  if  a  review  be  proper,  at  the  Appellate 
Division  the  denial  of  the  surrogate  of  his  application. 
So  held  by  Justice  Maddox,  denying  a  motion  of  the 
Comptroller  for  a  writ  of  mandamus  to  compel  the  sur- 
rogate to  accept  a  petition  and  appoint  an  appraiser 
upon  the  estate  of  a  nonresident  decedent. 

In  this  matter  it  appears  that  the  Comptroller's  at- 
torney presented  to  the  surrogate  of  Kings  county  a 
petition  on  behalf  of  the  Comptroller  for  the  appoint- 
ment of  an  appraiser  in  transfer  tax  proceedings  upon 
the  estate  of  one  Mallon,  a  nonresident,  which  petition 
was  duly  executed  and  acknowledged  by  the  Comp- 
troller's attorney,  and  contained  in  substance  the  fol- 
lowing allegations : 

That  on  or  about  the  30th  day  of  November,  1904,  William 
Mallon,  then  residing  without  the  State  of  New  York,  died 
leaving  property  in  the  county  of  Kings  and  State  of  New 
York  subject  to  taxation  under  the  act  in  relation  to  taxable 
transfers  of  property  to  the  value  and  upward  of  ten  thou- 
sand dollars  ($10,000);  that  said  decedent  died  intestate; 
that  said  property,  or  some  part  thereof,  is  subject  to  tax- 


362  THE   LAW    OF    TAXABLE    TRANSFERS. 

ation ;  that  no  payment  of  such  tax  has  been  made,  and  that 
no  proceeding  has  been  brought  to  fix  and  determine  the 
same  by  the  representatives  of  said  decedent,  and  that  all  the 
persons  who  are  interested  in  said  estate  and  who  are  en- 
titled to  notice  of  all  proceedings,  and  their  addresses  are  as 
follows  (naming  the  persons).  The  petition  was  returned  to 
the  attorney  with  the  indorsement  thereon  of  the  words, 
"Papers  insufficient,  J.  C.  C,  S." —  the  court  stating,  in 
substance,  that  Avhere  the  allegations  of  the  petition  were 
made  upon  information  and  belief,  he  would  not  appoint  an 
appraiser  upon  the  petition  of  the  State  Comptroller,  unless 
such  petition  set  forth  the  facts  which  led  the  State  Comp- 
troller to  believe  that  the  decedent  died  leaving  property 
subject  to  tax  in  Kings  county  as  fully  as  such  facts  would 
have  to  be  set  forth  in  the  affidavits  on  an  application  for  an 
injunction  in  an  action  in  the  Supreme  Court. 

The  Comptroller  contended  that  the  surrogate's  discretion 
to  order  an  appraisal,  only  applied  in  respect  to  that  part  of 
section  230  which  authorizes  the  surrogate  "  upon  his  own 
motion  "  to  order  an  appraisal ;  that  where  application  was 
made  "  by  an  interested  person,  including  the  State  Comp- 
troller," as  further  provided  by  said  section  230,  the  sur- 
rogate shall,  by  order,  direct  the  appraisal  to  be  had,  thus 
making  it  mandatory  upon  the  surrogate  where  the  applica- 
tion was  made  by  an  interested  person. 

The  court  at  Special  Term  further  stated  that  it  did  not 
consider  the  word  "  shall,"  as  mandatory;  that  it  is  "  clearly 
within  the  judicial  function  to  determine  whether  the 
'  party  '  making  the  application  is  '  interested.'  Again,  to 
determine  whether  there  is  sufficient  stated  in  the  papers  to 
show  that  the  estate  referred  to  is  subject  to  tax ;"  that  juris- 
dictional facts  must  be  shown,  and  it  is  primarily  for  the 
surrogate  to  determine  that  question,  and  that  the  words 
"  shall  by  order  direct,"  of  necessity  depend  upon  the  show- 
ing of  jurisdictional  facts,  and  consequently  that  the  surro- 
gate must  exercise  his  judicial  discretion  in  determining  as 
to  thp  sufficiency  of  the  papers  presented. 


EEVIEWING   SURROGATE'S   DISCRETION.  363 

It  is  not  apparent,  however,  why  the  court  should 
determine  whether  the  State  Comptroller  is  an  inter- 
ested person,  for  the  reason  that  the  statute  includes 
the  State  Comptroller  as  an  interested  person  author- 
ized to  institute  proceedings  to  determine  the  tax- 
ability of  an  estate.  See  in  this  connection  Matter  of 
O'Donohue,  44  App.  Div.  186,  59  N.  Y.  S.  1087,  60  N. 
Y.  S.  690. 

Further  reference  to  the  provisions  of  section  232,  see  Appeals, 
chapter  XVII. 


CHAPTER  XIX. 


Composition  Agreements — Surrogates'  Assistants  — 
Proceedings  by  District  Attorneys. 


470.  Composition    of    transfer    tax 

upon  certain  estates. 

471.  Composition  agreements. 

472.  Corresponding   section   of  for- 

mer   acts   relating   to    com- 
position agreements. 

473.  Surrogates'  assistants  in  New 

York,     Kings,     and      other 
counties. 

474.  Corresponding  sections  of  for- 

mer acts  relating  to  surro- 
gates' assistants,  etc. 
47o.  Proceedings  by  district  attor- 
neys. 

476.  Certificate        of        "  probable 

cause." 

477.  When  proceedings  to  be  com- 

menced. 

478.  Which    district    attorney    can 

bring  proceedings. 


479.  Former    adjudication    exempt- 

ing legacy  is  a  bar. 

480.  How  proceedings  commenced. 

481.  What  can  be  fhown  on  the  re- 

turn of  the  citation. 

482.  When  the   correctness   of  the 

assessment        cannot        be 
raised. 

483.  Order  directing  payment. 

484.  Order  for  payment  of  tax,  how 

enforced. 

485.  This  proceeding  is  not  in  na- 

ture of  an  action  for  a  pen- 
alty. 

486.  Costs  to  district  attorney. 

487.  When  district  attorney  is  un- 

successful.. 

488.  Corresponding  sections  of  for- 

mer acts  relating  to  district 
attorney  proceedings. 


470.  Composition  of  Transfer  Tax  Upon  Certain  Estates. 

[§  233,  Tax  Law.]  The  state  comptroller,  by  and  with 
the  consent  of  the  attorney-general  expressed  in  writing,1  is 
hereby  empowered  and  authorized  to  enter  into  an  agreement 
with  the  trustees  of  any  estate  in  which  remainders  or  ex- 
pectant estates  have  been  of  such  a  nature,  or  so  disposed  and 
circumstanced  that  the  taxes  therein  were  held  not  presently 

1.  Chap  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  Provides 
that  the  State  Comptroller,  with  the  consent  of  the  Attorney-General,  can 
make  and  execute  a  composition  agreement  in  settlement  of  transfer 
taxes  in  certain  cases.  Prior  to  this  amendment  the  State  Comptroller 
only  made  such  agreements  in  the  counties  where  the  office  of  appraiser 
is  salaried,  but  approved  such  agreements  when  mad*?  in  the  other 
counties  by  the  county  treasurer  thereof  respectively. 

[364] 


COMPOSITION    AGREEMENTS.  365 

payable,  or  where  the  interests  of  the  legatees  or  devisees 
were  not  ascertainable  under  the  provisions  of  chapter  four 
hundred  and  eighty-three  of  the  laws  of  eighteen  hundred  and 
eighty-five ;  chapter  three  hundred  and  ninety-nine  of  the 
laws  of  eighteen  hundred  and  ninety-two,  or  chapter  nine 
hundred  and  eight  of  the  laws  of  eighteen  hundred  and 
ninety-six,  and  the  several  acts  amendatory  thereof  and  sup- 
plemental thereto;  and  to  compound  such  taxes  upon  such 
terms  as  may  be  deemed  equitable  and  expedient ;  and  to 
grant  discharge  to  said  trustees  upon  the  payment  of  the 
taxes  provided  for  in  such  composition,  provided,  however, 
that  no  such  composition  shall  be  conclusive  in  favor  of  said 
trustees  as  against  the  interests  of  such  cestuis  que  trust  as 
may  possess  either  present  rights  of  enjoyment,  or  fixed, 
absolute  or  indefeasible  rights  of  future  enjoyment,  or  of 
such  as  would  possess  such  rights  in  the  event  of  the  imme- 
diate termination  of  particular  estates,  unless  they  consent 
thereto,  either  personally,  when  competent,  or  by  guardian  or 
committee.  Composition  or  settlement  made  or  effected  un- 
der the  provisions  of  this  section  shall  be  executed  in  tripli- 
cate, and  one  copy  filed  in  the  office  of  the  state  comptroller, 
one  copy  in  the  office  of  the  surrogate  of  the  county  in  which 
the  tax  was  paid,  and  one  copy  delivered  to  the  executors, 
administrators  or  trustees  who  shall  be  parties  thereto.2 

471.  Composition  Agreements. 

Chapter  379  of  the  Laws  of  1900,  in  effect  April  11th 
of  that  year,  relative  to  the  composition  of  transfer 
taxes  upon  certain  estates,  was  repealed  and  substan- 
tially re-enacted  by  chapter  173  of  the  Laws  of  1901, 
in  effect  April  1st  of  that  year,  and  added  as  a  new 

2.  Chap.  370,  Laws  1000  —  in  effect  April  11  of  that  year. —  First  en- 
acted substantially  the  provision  of  this  section  as  an  independent  act, 
entitled  "An  Act  to  provide  for  the  composition  of  transfer  tax  upon 
certain  estates." 

By  Chap.  173,  Laws  1901  —  in  effect  April  1  of  that  year. —  The  pro- 
vision of  chapter  370,  Laws  1000  (supra),  were  re-enacted  as  a  new 
section,  230a  of  the  Transfer  Tax  Law. 


366        THE  LAW  OP  TAXABLE  TRANSFERS. 

section  (§  230-a)  to  article  10  of  the  Tax  Law. 
This  provision  was  substantially  re-enacted  by  chap- 
ter 368,  Laws  1905,  section  233,  in  effect  June  1st  of 
that  year,  except  that  by  the  Act  of  1905  the  State 
Comptroller,  by  and  with  the  consent  of  the  Attorney- 
General,  is  empowered  to  make  such  composition  of 
transfer  tax  in  all  the  counties  of  the  State,  instead  of 
those  in  which  the  office  of  appraiser  is  salaried  as 
formerly  provided  by  section  230-a  aforesaid. 

As  the  facts  surrounding  each  case  where  a  com- 
promise is  desired  are  generally  different,  and  must 
necessarily  be  taken  into  consideration  in  arriving  at 
a  fair  basis  of  compromise,  no  fixed  rule  can  be  estab- 
lished respecting  such  agreements,  except  that  the  rate 
of  tax  will,  of  course,  depend  upon  the  possibility  of 
the  remainders,  or  other  interests,  ultimately  vesting 
in  the  1-per  cent,  or  5-per  cent,  class.  After  the  facts 
have  been  agreed  upon  by  the  parties  authorized  to 
make  such  compromise,  the  computation  of  the  tax  is 
made  as  though  the  property  would  ultimately  pass 
pursuant  to  the  agreement  aforesaid,  and  the  amount 
of  tax  is  then  determined  and  discounted  for  imme- 
diate payment,  and  such  sum  forms  the  consideration 
for  the  composition  of  the  tax. 

472  Corresponding  Sections  of  Former  Acts  Relating  to  Com- 
position Agreements. 

Section  230  of  the  Act  of  1896,  as  amended  by  chap- 
ter 284,  Laws  1897,  in  effect  April  16th  of  that  year, 
provided  that  when  property  was  devised  or  be- 
queathed in  trust  for  persons  in  succession  who  are 
not  liable  at  the  same  rate,  that  an  agreement  could 


surrogate's  assistants.  367 

be  made  between  the  persons  therein  named  to  com- 
promise such  taxes  upon  such  terms  as  may  be  deemed 
equitable  and  expedient,  but  this  provision  was  omitted 
by  chapter  76,  Laws  1899,  amending  section  230  of  that 
year,  and  a  new  provision  was  enacted  as  an  inde- 
pendent statute  by  chapter  379,  Laws  1900,  in  effect 
April  11th  of  that  year,  providing  for  the  composition 
of  transfer  taxes  upon  certain  estates.  This  provision 
by  chapter  173  of  the  Laws  of  1901,  in  effect  April  1st 
of  that  year,  became  section  230-a  of  the  Transfer  Tax 
Law  and  was  re-enacted  under  section  233  by  chapter 
368,  Laws  1905,  in  effect  June  1st  of  that  year. 

473.  Surrogate's  Assistants  in  New  York,  Kings,    and    Other 
Counties. 

[§  234,  Tax  Law.]  The  state  comptroller1  may,  upon  the 
recommendation  of  the  surrogate,  appoint,  and  may  at 
pleasure  remove  assistants  and  clerks  in  the  surrogate's  offices 
of  the  following  counties,  at  annual  salaries  to  be  fixed  by  him 
not  to  exceed  the  amounts  hereinafter  specified: 

1.  In  New  York  county,  a  transfer  tax  assistant,  four  thou- 
sand dollars ;  a  transfer  tax  clerk,  two  thousand  four  hundred 
dollars;  an  assistant  clerk,  eighteen  hundred  dollars;  a  re- 
cording clerk,  thirteen  hundred  dollars;  a  stenographer,  eight 
hundred  dollars;  and  shall  be  entitled  to  expend  not  more 
than  five  hundred  dollars  a  year  in  such  office  for  expenses 
necessarily  incurred  in  the  assessment  and  collection  of  taxes 
under  this  article.2 

1.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  Provides  for 
the  appointment  and  removal  of  assistants  and  clerks  in  the  surrogate's 
office  of  the  counties  named  in  section  234,  by  the  State  Comptroller, 
upon  the  recommendation  of  the  surrogate.  Prior  to  this  the  surrogate 
could  appoint  and  remove  such  assistants. 

2.  Chap.  399,  Laws  1892  — in  effect  May  1  of  that  year. — First  provided 
for  a  transfer  tax  assistant  and  other  clerks  above  named  in  the  surro- 
gate's office  in  New  York  county.  This  provision  was  formerly  a  part 
of  section  233  of  chapter  908,  Laws  1890,  said  section  providing  also  for 


368  THE    LAW    OF    TAXABLE    TRANSFERS. 

2.  In  Kings  county,  a  transfer  tax  assistant,  four  thousand 
dollars ;  a  transfer  tax  clerk,  two  thousand  dollars ;  an  as- 
sistant clerk,  fifteen  hundred  dollars ;  and  shall  be  entitled  to 
expend  not  more  than  five  hundred  dollars  a  year  for  ex- 
penses necessarily  incurred  in  the  assessmem  and  collection 
of  taxes  under  this  article.3 

3.  In  Erie  county,  a  transfer  tax  clerk,  eighteen  hundred 
dollars.4 

4.  In  Westchester  county,  a  transfer  tax  assistant,  two 
thousand  dollars.4 

5.  In  Albany  county,  a  transfer  tax  clerk,  one  thousand 
dollars.4 

6.  In  Queens  county,  a  transfer  tax  clerk,  one  thousand 
dollars.5 

7.  In  Onondaga  county,  a  transfer  tax  clerk,  twelve  hun- 
dred dollars.4 

8.  In  Monroe  county,  two  transfer  tax  clerks,  seven  hun- 
dred and  fifty  dollars  each ;  and  shall  be  entitled  to  expend 
not  more  than  two  hundred  dollars  a  year  for  expenses  neces- 
sarily incurred  in  the  assessment  and  collection  of  taxes  un- 
der this  article.6 


the  appointment  of  assistants  for  the  district  attorney  in  New  York 
and  Erie  counties,  which  had  been  previously  authorized  by  chapter 
515,  Laws  1895,  in  effect  May  2  of  that  year.  This  latter  provision  was 
omitted  by  chapter  173,  Laws  1901,  and  by  the  Act  of  1905,  former 
sections  233  and  234  were  united  in  section  233   (supra). 

3.  Chap.  908,  Laws  1896  — in  effect  June  15  of  that  year.— Section 
234  first  provided  for  transfer  tax  clerks  and  assistants  in  Kings  county. 
By  chapter  173,  Laws  1901,  section  234,  was  amended  so  as  to  include 
the  various  provisions  respecting  the  transfer  tax  clerks  and  assistants 
in  the  other  counties  having  such  clerks. 

4.  Chap.  173,  Laws  1901 — in  effect  April  1  of  that  year. —  Provided 
for  a  transfer  tax  clerk  in  Westchester,  Suffolk,  Oneida,  Ulster,  Onon- 
daga, Erie,  and  Albany  counties,  and  also  included  Kings  and  Monroe 
counties,  in  which  transfer  tax  clerks  had  been  appointed  by  an  earlier 
law. 

5.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  First  pro- 
vides for  a  transfer  tax  clerk  in  Queens  county. 

6.  Chap.  952,  Laws  1896  —  in  effect  May  28  of  that  year.— First  pro- 
vided for  two  transfer  tax  clerks  in  Monroe  county  and  for  annual 
expenses  as  above.  This  provision  was  included  in  the  amendment  by 
chapter  173,  Laws  1901. 


surrogate's  assistants.  369 

9.  In  Dutchess  county,  a  transfer  tax  clerk,  nine  hundred 
dollars.7 

10.  In  Oneida  county,  not  more  than  two  transfer  tax 
clerks,  twelve  hundred  dollars  in  the  aggregate.4 

11.  In  Suffolk  county,  a  transfer  tax  clerk,  one  thousand 
dollars.4 

12.  In  Ulster  county,  a  transfer  tax  clerk,  seven  hundred 
and  twenty  dollars.4 

Such  salaries  and  expenses  shall  be  paid  monthly  by  the 
state  comptroller,  upon  proper  vouchers,  out  of  any  funds  in 
his  hands  on  account  of  taxes  collected  under  this  article. 

474.  Corresponding  Sections  of  Former  Acts  Relating  to  Sur- 
rogates' Assistants,  Etc. 

Former  sections  233  and  234,  respecting  the  surro- 
gates' assistants  in  New  York  and  other  counties,  were 
consolidated  and  amended  by  chapter  368,  Laws  1905, 
and  re-enacted  under  section  234  of  the  Act  of  1905. 

By  the  Act  of  1905  aforesaid,  the  State  Comptroller 
is  authorized,  upon  the  recommendation  of  the  surro- 
gate, to  appoint,  and  may  at  pleasure  remove  the  as- 
sistants and  clerks  in  the  counties  of  New  York,  Kings, 
Erie,  Westchester,  Albany,  Queens,  Onondaga,  Mon- 
roe, Dutchess,  Oneida,  Suffolk,  and  Ulster  counties. 
Prior  to  this  amendment  the  surrogates  of  the  coun- 
ties named  were  authorized  to  appoint  and  at  pleasure 
remove  such  assistants. 

4.  Chap.  173,  Laws  1901  —  in  effect  April  1  of  that  year. —  Provided 
for  a  transfer  tax  clerk  in  Westchester,  Suffolk,  Oneida,  Ulster,  Onon- 
daga, Erie,  and  Albany  counties,  and  also  included  Kings  and  Monroe 
counties,  in  which  transfer  tax  clerks  had  been  appointed  by  an  earlier 
law. 

7.  Chap.  283,  Laws  1902  — in  effect  March  29  of  that  year.— First 
provides  for  a  transfer  tax  clerk  in  Dutchess  county.  This  provision 
was  included  in  the  amendment  by  chapter  368,  Laws  1905. 

24 


370        THE  LAW  OF  TAXABLE  TRANSFERS. 

475.  Proceedings  by  District  Attorneys. 

[§  235,  Tax  Law.]  If,  after  the  expiration  of  eighteen 
months  from  the  accrual  of  any  tax  under  this  article,1  such 
tax  shall  remain  due  and  unpaid,  after  the  refusal  or  neglect 
of  the  persons  liable  therefor  to  pay  the  same,  the  state  comp- 
troller2 shall  notify  the  district  attorney  of  the  county,  in 
writing,  of  such  failure  or  neglect,  and  such  district  attorney 
shall  apply  to  the  surrogate's  court  for  a  citation,  citing  the 
persons  liable  to  pay  such  tax  to  appear  before  the  court  on 
the  day  specified,  not  more  than  three  months  after  the  date 
of  such  citation,  and  show  cause  why  the  tax  should  not  be 
paid.  The  surrogate,  upon  such  application,  and  whenever 
it  shall  appear  to  him  that  any  such  tax  accruing  under  this 
article  has  not  been  paid  as  required  by  law,  shall  issue  such 
citation  and  the  service  of  such  citation,  and  the  time,  man- 
ner and  proof  thereof,  and  the  hearing  and  determination 
thereon  and  the  enforcement  of  the  determination  or  order 
made  by  the  surrogate  shall  conform  to  the  provisions  of  the 
code  of  civil  procedure  for  the  service  of  citations  out  of  the 
surrogate's  court,  and  the  hearing  and  determination  thereon 
and  its  enforcement  so  far  as  the  same  may  be  applicable. 
The  surrogate  or  his  clerk  shall,  upon  request  of  the  district 
attorney  or  the  state  comptroller,  furnish,  without  fee,  one  or 
more  transcripts  of  such  decree,  which  shall  be  docketed  and 
filed  by  the  county  clerk  of  any  county  of  the  state  without 
fee,  in  the  same  manner  and  with  the  same  effect  as  provided 
by  law  for  filing  and  docketing  transcripts  of  decrees  of  the 
surrogate's  court.  The  cost  awarded  by  any  such  decree  after 
the  collection  and  payment  of  the  tax  to  the  state  comptroller 
or  county  treasurer  may  be  retained  by  the  district  attorney 
for  his  own  use.  Such  costs  shall  be  fixed  by  the  surrogate 
in  his  discretion,  but  shall  not  exceed  in  any  case  where  there 

1.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  First  lim- 
ited time  when  proceedings  were  to  be  commenced  under  this  provision. 

2.  Chap.  368,  Laws  1905  —  in  effect  June  1. —  First  names  State 
Comptroller  as  the  only  person  to  notify  the  district  attorney  of  the 
failure  to  pay  tax. 


PROCEEDINGS    BY    DISTRICT    ATTORNEYS.  371 

has  not  been  a  contest,  the  sum  of  one  hundred  dollars,  or 
where  there  has  been  a  contest  the  sum  of  two  hundred  and 
fifty  dollars.  Whenever  the  surrogate  shall  certify  that  there 
was  probable  cause  for  issuing  a  citation  and  taking  the  pro- 
ceedings specified  in  this  section,  the  state  comptroller,  after 
the  same  shall  have  been  audited  by  him,  shall  pay  all  ex- 
penses incurred  for  the  service  of  citations  and  other  lawful 
disbursements  not  otherwise  paid,  from  funds  in  his  hands 
on  account  of  such  tax,  or  in  a  county  in  which  the  office  of 
appraiser  is  not  salaried,  by  a  warrant  upon  the  county 
treasurer  of  such  county  for  the  payment  by  him  of  the  same 
from  funds  in  his  hands  on  account  of  such  tax.3  In  pro- 
ceedings to  which  the  state  comptroller  is  cited  as  a  party 
under  sections  two  hundred  and  twenty-nine4  and  two  hun- 
dred and  thirty  of  this  article,  he  is  authorized  to  designate 
and  retain  counsel  to  represent  him  and  to  pay  the  expenses 
thereby  incurred  out  of  the  funds  which  may  be  in  his  hands 
on  account  of  this  tax  in  any  case  in  a  county  where  the 
office  of  appraiser  is  salaried,  and  in  any  other  county  the 
state  comptroller  shall  by  warrant  direct  the  county  treasurer 
to  pay  such  expenses  out  of  any  funds  which  may  be  in  his 
hands  on  account  of  this  tax  f  provided,  however,  that  in  the 
collection  of  taxes  upon  estates  of  nonresident  decedents  the 
state  comptroller  shall  not  allow  for  legal  services  up  to  and 
including  the  entry  of  the  order  of  the  surrogate  fixing  the 

3.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year. —  Sections 
16  and  17  contained  provisions  relative  to  instituting  district  attorney 
proceedings  for  the  collection  of  tax  remaining  unpaid,  when  notified  in 
writing  by  the  county  treasurer  or  comptroller.  These  provisions  were 
substantially  re-enacted  in  section  15  of  chapter  309,  Laws  1892,  in 
effect  May  I  of  that  year,  and  in  section  235  of  chapter  908,  Laws 
1896,  in  effect  June  15  of  that  year. 

Chap.  173,  Laws  1901  —  in  eil'ect  April  1  of  that  year. —  Provided  that 
the  countv  treasurer  or  State  Comptroller  "in  a  county  in  which  he  is 
authorized  to  receive  the  tax  "  shall  notify  the  district  attorney  to  com- 
mence the  proceedings,  etc. 

4.  Reference  was  doubtless  intended  to  be  made  to  section  228,  but 
the  reference  is  not  material. 

5.  Chap.  399,  Laws  1892  —  in  effect  May  1  of  that  year.— Authorized 
the  State  Comptroller  fo  designate  counsel  to  represent  him  or  the 
county  treasurer  where  either  of  Hum  were  cited  as  a  party  under 
sections  11  and  12  of  that  act. 


372         THE  LAW  OF  TAXABLE  TRANSFERS. 

tax  a  sum  exceeding  ten  per  centum  of  the  taxes  and  penal- 
ties collected.6 

476.  Certificate  of  "  Probable  Cause." 

Former  section  235  provided  that  if  the  county  treas- 
urer or  State  Comptroller  shall  have  reason  to  believe 
that  any  tax  is  due  and  unpaid  *  *  *  after  the 
refusal  or  neglect  of  the  persons  liable  therefor  to  pay 
the  same,  the  district  attorney  of  the  county  should 
be  notified  of  such  failure  and  then  proceedings  were 
to  be  instituted  by  that  official  for  the  collection  of  said 
tax  if  he  have  probable  cause  to  believe  such  tax  is 
due  and  unpaid. 

The  court  in  an  early  case  (Matter  of  McCarthy,  5 
Misc.  Rep.  276,  25  N.  Y.  S.  987)  says:  "  That  the 
Comptroller  believed  that  there  was  a  tax  due,  and 
that  the  district  attorney  had  probable  cause  to  be- 
lieve that  the  tax  was  due  is  not  a  sufficient  basis  on 
which  this  court  should  find  judicially  that  probable 
cause  existed."  The  court  said  further  that  a  cer- 
tificate of  probable  cause  will  only  be  granted  where 
an  affidavit  is  filed  disclosing  all  the  pertinent  facts, 
and  giving  data  from  which  the  court  may  be  able  to 
make  independent  investigation  if  desired. 

477.  When  Proceedings  to  be  Commenced. 

Until  recently  the  practice  has  been  in  some  of  the 
counties  to  institute  proceedings  under  this  section 
before  the  expiration  of  the  eighteen  months  within 

6.  Chap.  173,  Laws  1901  —  in  effect  April  1  of  that  year. —  First  con- 
tained the  provision  limiting  the  amount  to  be  paid  attorneys  in  pro- 
ceedings upon  nonresident  estates  to  the  maximum  fee  of  10  per  cent. 
of  tax  and  penalties  collected. 


PROCEEDINGS   BY   DISTRICT   ATTORNEYS.  373 

which  time  the  executor  or  administrator  can  pay  the 
tax  without  interest,  and  under  the  former  section  235, 
no  time  was  stated  before  the  proceedings  could  be 
instituted. 

By  chapter  368,  Laws  1905,  in  effect  June  1st  of  that 
year,  section  235  was  so  amended  that  these  proceed- 
ings cannot  now  be  instituted  until  after  the  expiration 
of  eighteen  months  from  the  accrual  of  any  tax  under 
this  article. 

It  was,  however,  declared  in  Frazer  v.  People,  6 
Dem.  174,  3  N.  Y.  S.  134,  that  where  a  proceeding  was 
brought  by  the  district  attorney  within  eighteen 
months  from  the  decedent's  death,  that  in  view  of  the 
fact  that  the  representative  of  the  estate  is  given  eigh- 
teen months  within  which  he  can  pay  the  tax  without 
incurring  any  liability  to  pay  interest  upon  the  amount 
of  said  tax,  that  it  is  the  proper  practice  to  not  insti- 
tute the  proceedings  by  the  district  attorney  until  after 
the  expiration  of  that  time. 

In  the  Matter  of  Wolfe,  137  N.  Y.  205-214,  the  court 
held  that  proceedings  for  the  enforcement  of  a  tax  can 
be  taken  only  when  the  tax  is  due  and  has  not  been 
paid. 

478.  Which  District  Attorney  Can  Bring  Proceedings. 

Former  section  235  provided,  that  if  the  county 
treasurer,  or  State  Comptroller,  shall  have  reason  to 
believe  that  any  tax  is  due  and  unpaid  "  in  a  county  in 
which  he  is  authorized  to  receive  the  tax  *  *  *  he 
shall  notify  the  district  attorney  of  the  county  in 
writing,"  etc.  By  the  amendment  in  1905,  the  State 
Comptroller  is  the  only  person  authorized  to  notify 


374        THE  LAW  OF  TAXABLE  TKANSFERS. 

the  district  attorney  of  the  failure  or  neglect  of  the 
persons  liable  to  pay  the  tax,  and  while  no  provision 
is  expressly  made  as  to  the  particular  district  attorney 
to  be  so  notified,  such  provision  was  doubtless  deemed 
unnecessary  owing  to  the  fact,  that  by  section  242  the 
words  "  district  attorney,"  as  used  in  this  article, 
shall  be  taken  to  mean  the  district  attorney  of  the 
county  of  the  surrogate  having  jurisdiction  as  pro- 
vided by  section  228. 

479.  Former  Adjudication  Exempting  Legacy  is  a  Bar. 

An  adjudication  exempting  certain  legacies  from 
liability  to  taxation  is  a  complete  bar  to  the  main- 
tenance of  any  subsequent  proceeding  by  the  district 
attorney  to  collect  a  tax  thereupon.  Matter  of  Wolfe, 
137  N.  Y.  205,  revg.  66  Hun,  389,  21  N.  Y.  S.  515-522. 

480.  How  Proceedings  Commenced. 

Upon  the  application  of  the  district  attorney  to  the 
proper  surrogate,  the  interested  persons  in  proceed- 
ings under  this  section  are  brought  into  court  upon  a 
certain  day  to  show  cause  why  the  tax  should  not  be 
paid  and  the  service  of  the  citation  and  the  subsequent 
proceedings  therein  shall  conform  to  the  provisions 
of  the  Code  for  the  service  of  citation  out  of  the  Sur- 
rogate's Court,  and  the  hearing  and  enforcement  of 
the  determination  of  the  surrogate,  so  far  as  the  same 
may  be  applicable. 

481.  What  Can  be  Shown  on  the  Return  of  the  Citation. 

In  the  Matter  of  McPherson,  104  N.  Y.  306-323, 
Judge  Earl,  in  referring  to  proceedings  brought  by 


PROCEEDINGS    BY    DISTRICT    ATTORNEYS.  375 

the  district  attorney,  and  the  rights  of  the  interested 
parties,  said:  "  Upon  the  return  of  the  citation,  it  is 
not  specified  in  the  section  what  cause  can  be  shown 
against  the  payment  of  the  tax ;  but  it  is  clear  that  the 
person  thus  cited  may  allege  any  reason  whatever 
which  shows  that  he  ought  not  to  pay  it.  He  may 
answer  that  he  has  not  had  an  opportunity  to  be  heard 
upon  the  appraisal,  and  that  therefore  the  tax  as  to 
him  is  void.  He  may  show  any  error  affecting  the 
validity  of  the  tax,  or  that  he  has  never  received  and 
never  will  receive  the  inheritance  or  legacy;  and  it 
would  undoubtedly  be  a  justification  for  refusing  to 
pay  that  he  had  absolutely  renounced  and  refused  to 
accept  or  receive  the  inheritance  or  legacy." 

482.  When   the    Correctness    of    the    Assessment   Cannot    be 

Raised. 

An  objection  to  the  correctness  of  the  amount  of  an 
assessment  cannot  be  raised  in  proceedings  to  compel 
the  payment  of  the  transfer  tax,  where  no  appeal  from 
the  order  fixing  the  amount  of  such  tax  was  taken 
within  the  time  limited  therefor.  Matter  of  Hackett, 
14  Misc.  Eep.  282,  35  N.  Y.  S.  1051. 

483.  Order  Directing  Payment. 

While  the  statute  makes  the  executor  or  admin- 
istrator, and  the  legatee,  both  equally  liable  for  the 
payment  of  the  tax,  yet  it  does  not  specify  in  these 
proceedings  which  one  shall  be  directed  to  pay  the  tax 
in  the  event  of  its  appearing  that  the  estate  is  liable  to 
a  tax  which  has  not  been  paid.  Some  of  the  earlier 
cases  held  that  the  order  should  not  direct  that  both 


376  THE    LAW    OF    TAXABLE    TRANSFERS. 

the  executors  and  the  beneficiaries  pay  the  tax,  but  that 
the  district  attorney  might  elect  whether  he  would  hold 
the  executors  personally  liable,  or  the  legatees.  This 
construction  of  the  law  seems  entirely  without  au- 
thority and  the  better  practice  would  be  for  the  order 
to  first  decree  their  several  liability  to  pay  the  tax  as 
created  by  the  statute,  and  then  contain  an  alterna- 
tive provision  as  to  the  liability  of  the  executors  in  the 
event  of  the  tax  not  being  collectable  from  the  person 
or  persons  receiving  the  property. 

484.  Order  for  Payment  of  Tax,  How  Enforced. 

An  order  for  the  payment  of  tax  cannot  be  enforced 
by  proceedings  for  contempt  until  the  return  of  an 
execution  on  the  surrogate's  decree.  Matter  of  Front, 
19  N.  Y.  St.  R.  318,  3  N.  Y.  S.  831. 

485.  This  Proceeding  is  not  in  Nature  of  an  Action  for  a 

Penalty. 

An  action  to  compel  the  payment  of  a  legacy  tax  is 
not  an  action  for  a  penalty  which  must  be  brought 
within  two  years  after  the  cause  of  action  accrues. 
(Code,  §  384.)  Matter  of  Wolfe,  2  Connoly,  600;  affd. 
on  other  points,  137  N.  Y.  205. 

486.  Costs  to  District  Attorney. 

In  proceedings  by  the  district  attorney  under  the 
Transfer  Tax  Law  the  costs  and  disbursements  to 
which  he  may  deem  himself  entitled  to,  in  case  of  suc- 
cess, must  be  taxed  in  the  same  manner  as  costs  in 
other  proceedings  in  a  Surrogate's  Court.  Matter  of 
McCarthy,  5  Misc.  Rep.  276,  25  N.  Y.  S.  987. 


PEOCEEDINGS  BY  DISTRICT  ATTORNEYS.  377 

No  costs  can  be  allowed  against  the  executors  in 
proceedings  by  the  district  attorney,  where  the  exec- 
utors pay  the  tax  before  the  expiration  of  the  eighteen 
months.    Frazer  v.  People,  6  Dem.  174,  3  N.  Y.  S.  134. 

487.  When  District  Attorney  is  Unsuccessful. 

In  order  to  entitle  himself  to  the  certificate  of  prob- 
able cause  under  section  15  of  the  Act  of  1892  (now 
§  235)  where  he  is  unsuccessful  he  must  apply  therefor 
upon  proof  showing  his  nonsuccess  and  furnish  evi- 
dence to  establish  to  the  satisfaction  of  the  surrogate 
that  there  was  probable  cause  for  issuing  the  citation 
and  taking  the  proceeding.  Matter  of  McCarthy 
(supra). 

488.  Corresponding  Sections  of  Former  Acts. 

Sections  16,  17,  and  18  of  the  Act  of  1885  contained 
provisions  similar  to  section  235,  relative  to  the  pro- 
ceedings to  be  instituted  for  the  collection  of  any  tax 
which  had  not  been  paid. 

By  chapter  399,  Laws  1892,  in  effect  May  1st  of  that 
year,  section  15  of  that  act  contained  a  revision  of  sec- 
tions 16,  17,  and  18  of  the  Act  of  1885,  in  reference  to 
proceedings  for  the  collection  of  taxes. 

By  chapter  908,  Laws  1896,  in  effect  June  15th  of 
that  year,  the  provisions  of  section  15  of  the  Act  of 
1892  were  re-enacted  in  section  235  of  the  Act  of  1896. 

By  chapter  173,  Laws  1901,  in  effect  April  1st  of  that 
year,  section  235  was  amended  owing  to  the  change 
made  in  section  230  by  said  chapter  173,  as  to  salaried 
appraisers  in  certain  counties  of  the  State,  and  the 
direct  payment  of  the  tax  in  such  counties  to  the  State 


378        THE  LAW  OF  TAXABLE  TRANSFERS. 

Comptroller.  This  amendment  also  provided  that  the 
compensation  to  attorneys  in  proceedings  upon  the 
estates  of  nonresidents  to  and  including  the  making  of 
the  order  fixing  the  tax  should  not  exceed  10  per 
centum  of  the  taxes  and  penalties  collected. 

By  chapter  368,  Laws  1905,  in  effect  June  1st  of  that 
year,  the  provision  at  the  end  of  said  section  235,  rela- 
tive to  the  compromise  of  the  tax  ' '  where  controversies 
have  arisen  or  may  hereafter  arise  as  to  the  relation- 
ship of  the  beneficiaries  to  the  former  owner  thereof?" 
(whatever  that  may  mean),  was  omitted. 


CHAPTER  XX. 


Receipts  —  Fees  of  County  Treasurers  —  Books, 
Etc.,  Furnished  by  State  Comptroller  —  Reports 
of  Surrogate,  County  Clerk,  and  County  Treas- 
urer —  Report  of  State  Comptroller  —  Payment 
and  Application  of  Taxes. 


489.  Receipts  from  county  treasurer 
or  comptroller, 

400.  Corresponding  sections  of  for- 
mer acts  relating  to  receipts. 

491.  Fees  of  county  treasurer. 

492.  Corresponding  sections  of  for- 

mer acts  relating  to  fees  of 
county  treasurer. 

493.  Books    and    forms   to   be    fur- 

nished by  the  State  Comp- 
troller. 

494.  Corresponding  sections  of  for- 

mer acts  relating  to  books, 
etc.,  to  be  furnished  by  the 
State  Comptroller. 

495.  Reports      of      surrogate      and 

county  clerk. 


406.  Corresponding  section  of  for- 
mer acts  relating  to  reports 
of  surrogates  and  county 
clerks. 

497.  Reports  of  county  treasurers. 

408.  Corresponding  sections  of  for- 
mer acts  relating  to  reports 
of  county  treasurers. 

499.  Report  of  State  Comptroller; 

payment  of  taxes. 

500.  Corresponding  sections  of  for- 

mer acts  relating  to  report 
of  State  Comptroller,  etc. 

501.  Application  of  taxes. 

502.  Corresponding  sections  of  for- 

mer acts  relating  to  applica- 
tion of  taxes. 


489.  Receipts  from  County  Treasurer  or  Comptroller. 

[S  236,  Tax  Law.]  One  of  the  duplicate  receipts  issued 
for  the  payment  of  any  tax  under  this  article,  as  provided 
by  section  two  hundred  and  twenty-two,  shall  be  counter- 
signed by  the  state  treasurer  if  the  same  was  issued  by  the 
state  comptroller,  and  by  the  state  comptroller  if  issued  by 
any  county  treasurer.  The  officer  so  countersigning  the 
same  shall  charge  the  officer  receiving  the  tax  with  the  amount 
thereof  and  affix  the  seal  of  his  office  to  the  same  and  return 
to  the  proper  person;  but  no  executor,  administrator  or  trus- 
tee shall  be  entitled  to  a  final  accounting  of  an  estate  in  settle- 

T3701 


380        THE  LAW  OF  TAXABLE  TRANSFERS. 

ment  of  which  a  tax  is  due  under  the  provisions  of  this  article 
unless  he  shall  produce  a  receipt  so  sealed  and  countersigned, 
or  a  certified  copy  thereof.1  Any  person  shall,  upon  the 
payment  of  fifty  cents  to  the  officer  issuing  such  receipt,  be 
entitled  to  a  duplicate  thereof,  to  be  signed,  sealed  and  coun- 
tersigned in  the  same  manner  as  the  original. 

Any  person  shall,  upon  the  payment  of  fifty  cents,  be  en- 
titled to  a  certificate  of  the  state  comptroller2  that  the  tax 
upon  the  transfer  of  any  real  estate  of  which  any  decedent 
died  seized  has  been  paid,  such  certificate  to  designate  the 
real  property  upon  which  such  tax  is  paid,  the  name  of  the 
person  so  paying  the  same,  and  whether  in  full  of  such  tax. 
Such  certificate  may  be  recorded  in  the  office  of  the  county 
clerk  or  register  of  the  county  where  such  real  property  is 
situate,  in  a  book  to  be  kept  by  him  for  that  purpose,  which 
shall  be  labeled  "  transfer  tax." 

490.  Corresponding  Sections  of  Former  Acts  Relative  to  Re- 
ceipts. 
Section  8  of  the  Act  of  1885  provided  that  the  treas- 
urer of  the  proper  county,  or  in  the  city  and  county  of 
New  York  the  comptroller  thereof,  should  give  every 
executor,  administrator,  or  trustee  duplicate  receipts 
for  payments  made  on  account  of  the  transfer  tax,  one 
of  which  the  executor  should  immediately  forward  to 
the  Comptroller  of  the  State  to  be  sealed  and  counter- 
signed by  him  and  returned  to  the  executor  as  a  proper 
voucher  in  the  settlement  of  his  accounts.  This  pro- 
vision was  substantially  re-enacted  in  section  3  by 
chapter  399,  Laws  1892,  in  effect  May  1st  of  that  year, 

1.  Chap.  483,  Laws  1885  —  in  effect  June  30  of  that  year. —  Section  8 
provided  for  receipts  for  the  payment  of  tax  to  be  given  by  the  county 
treasurers  and  comptroller,  and  to  be  countersigned  by  the  State  Comp- 
troller. 

2.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year.— First 
provides  for  the  State  Comptroller  to  issue  a  "  certificate  "  showing  tax 
paid  on  real  property. 


RELATING  TO  RECEIPTS.  381 

and  in  section  222  of  chapter  908,  Laws  1896,  in  effect 
June  15th  of  that  year. 

Section  222  of  chapter  908,  Laws  1896,  was  amended 
by  chapter  173,  Laws  1901,  in  effect  April  1st  of  that 
year,  owing  to  the  fact  that  in  some  counties  the  tax 
was  now  paid  direct  to  the  State  Comptroller,  in  which 
event  the  receipts  should  be  issued  by  the  State  Comp- 
troller and  sealed  and  countersigned  by  the  State 
Treasurer. 

The  provision  of  section  222,  in  reference  to  the 
duplicate  receipts,  was  re-enacted  with  slight  changes 
in  the  phraseology  thereof,  as  a  part  of  section  236  of 
chapter  368,  Laws  1905,  in  effect  June  1st  of  that  year. 

Section  23  of  the  Act  of  1885  provided  for  the  issu- 
ing of  a  receipt  showing  the  payment  of  tax  assessed 
upon  the  real  property  of  the  decedent  pursuant  to  this 
article. 

This  provision  was  substantially  re-enacted  in  sec- 
tion 16  of  chapter  399,  Laws  1892,  and  in  section  236 
of  chapter  908,  Laws  1896,  aforesaid. 

Section  236  was  amended  by  chapter  173,  Laws  1901, 
by  providing  that  the  State  Comptroller  should  furnish 
receipt  showing  payment  of  tax  on  real  property  in 
all  cases  where  the  tax  thereon  was  paid  direct  to  him. 

By  section  236  of  chapter  368,  Laws  1905,  in  effect 
June  1st  of  that  year,  this  provision  was  amended  and 
it  now  provides  that  the  State  Comptroller  shall  in  all 
instances,  upon  payment  of  the  fee  therefor,  issue  a 
certificate  showing  that  the  tax  upon  the  transfer  of 
any  real  estate  has  been  paid. 

Xo  provision  is  made  for  obtaining  a  certificate 
showing  that  the  real  estate  of  a  decedent  was  exempt 


382        THE  LAW  OF  TAXABLE  TRANSFERS. 

from  the  transfer  tax.  The  Comptroller  would  doubt- 
less be  justified  under  section  236  aforesaid,  in  issuing 
such  a  certificate,  where  it  appears  from  the  records  in 
his  office  that  proceedings  had  been  instituted  before 
the  proper  surrogate,  and  an  order  duly  entered  ex- 
empting the  transfer  of  such  real  estate. 

491.  Fees  of  County  Treasurer. 

[§  237,  Tax  Law.]  The  treasurer  of  each  county  in 
which  the  office  of  appraiser  is  not  salaried  shall  be  allowed 
to  retain  on  all  taxes  paid  and  accounted  for  by  him  each 
fiscal1  year  under  this  article,  five  per  centum  on  the  first 
fifty  thousand  dollars,  three  per  centum  on  the  next  fifty 
thousand  dollars,  and  one  per  centum  on  all  additional  sums. 
Such  fees  shall  be  in  addition  to  the  salaries  and  fees  now 
allowed  by  law  to  such  officers. 

482.  Corresponding  Sections  of  Former  Acts  Relating  to  Fees 
of  County  Treasurer. 

Section  22  of  the  Act  of  1885  allowed  the  county 
treasurer  of  each  county  and  the  comptroller  of  the 
city  and  county  of  New  York  to  retain  5  per  cent,  on 
all  taxes  paid  under  that  act. 

By  chapter  713,  Laws  1887,  in  effect  June  25th  of 
that  year,  this  section  was  amended  so  that  the  fees 
allowed  should  be  5  per  cent,  on  the  first  $50,000,  3  per 
cent,  on  the  next  $50,000,  and  1  per  cent,  on  all  addi- 
tional sums  paid  each  year.  This  provision,  as 
amended,  was  re-enacted  in  section  17  of  chapter  399, 
Laws  1892,  in  effect  May  1st  of  that  year,  and  sub- 

1.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  Provides 
that  the  "  fiscal "  year  shall  be  the  period  within  which  the  fees  of 
county  treasurers  shall  be  computed. 


BOOKS  AND  FORMS  TO  BE  FURNISHED.  383 

stantially  re-enacted  in  section  237  of  chapter  908, 
Laws  1896,  in  effect  June  15th  of  that  year. 

Section  237  was  amended  by  chapter  173,  Laws  1901, 
in  effect  April  1st  of  that  year,  by  allowing  the  above 
percentage  to  treasurers  in  the  counties  where  the 
office  of  appraiser  is  not  salaried. 

Section  237,  as  amended,  was  re-enacted  in  section 
237  of  chapter  368,  Laws  1905,  in  effect  June  1st  of 
that  year,  without  amendment,  except  that  the  year 
within  which  said  percentages  were  allowed  is  to  be  the 
fiscal  year,  namely,  from  October  1st  to  September 
30th  of  each  year. 

493.  Books  and  Forms  to  be  Furnished  by  the  State  Comp- 
troller. 

[§  238,  Tax  Law.]  The  state  comptroller  shall  furnish 
to  each  surrogate,  a  book,  which  shall  be  a  public  record, 
and  in  which  he  shall  enter  the  name  of  every  decedent  upon 
whose  estate  an  application  to  him  has  been  made  for  the 
issue  of  letters  of  administration,  or  letters  testamentary,  or 
ancillary  letters,  the  date  and  place  of  death  of  such  decedent, 
the  estimated  value  of  his  real  and  personal  property,  the 
names,  places  of  residence  and  relationship  to  him  of  his 
heirs-at-law,  the  names  and  places  of  residence  of  the  lega- 
tees and  devisees  in  any  will  of  any  such  decedent,  the 
amount  of  each  legacy  and  the  estimated  value  of  any  real 
property  devised  therein,  and  to  whom  devised.  These  en- 
tries shall  be  made  from  the  data  contained  in  the  papers 
filed  on  any  such  application,  or  in  any  proceeding  relating 
to  the  estate  of  the  decedent.  The  surrogate  shall  also  enter 
in  such  book  the  amount  of  the  personal  property  of  any 
such  decedent,  as  shown  by  the  inventory  thereof  when  made 
and  filed  in  his  office,  and  the  returns  made  by  any  appraiser 
appointed  by  him  under  this  article,  and  the  value  of  annui- 
ties, life  estates,  terms  of  years,  and  other  property  of  any 


384        THE  LAW  OF  TAXABLE  TRANSFERS. 

such  decedent  or  given  by  him  in  his  will  or  otherwise,  as 
fixed  by  the  surrogate,  and  the  tax  assessed  thereon,  and  the 
amounts  of  any  receipts  for  payment  of  any  tax  on  the  estate 
of  such  decedent  under  this  article  filed  with  him.  The 
state  comptroller  shall  also  furnish  to  each  surrogate  forms 
for  the  reports  to  be  made  by  such  surrogate,  which  shall 
correspond  with  the  entries  to  be  made  in  such  book.1 

494.  Corresponding  Sections  of  Former  Acts  Relative  to  Books, 

Etc.,  to  be  Furnished  by  State  Comptroller. 

Section  20  of  the  Act  of  1885  contained  a  provision 
in  reference  to  certain  books  to  be  forwarded  to  the 
surrogates  of  the  counties.  Section  18  of  chapter  399, 
Laws  1892,  in  effect  May  1st  of  that  year,  contains 
similar  provisions  in  reference  to  the  books  to  be  fur- 
nished the  surrogates  and  the  quarterly  reports  of  the 
surrogates  and  county  clerks. 

This  provision  became  section  238  of  chapter  908, 
Laws  1896,  in  effect  June  15th  of  that  year,  and  was 
re-enacted  in  section  238  of  chapter  368,  Laws  1905,  in 
effect  June  1st  of  that  year. 

495.  Reports  of  Surrogate  and  County  Clerk. 

[§  239,  Tax  Law.]  Each  surrogate  shall,  on  January, 
April,  July  and  October  first  of  each  year  make  a  report, 
upon  the  forms  furnished  by  the  comptroller  containing  all 
the  data  and  matters  required  to  be  entered  in  such  book, 
which  shall  be  immediately  forwarded  to  the  state  comp- 
troller. The  county  clerk  of  each  county,  except  in  the  coun- 
ties where  the  registers  perform  the  duties  of  the  county 
clerk  with  respect  to  the  recording  of  deeds,  and  when  in 
such  counties  the  registers,  shall,  at  the  same  times,  make 
reports  containing  a  statement  of  any  deed  or  other  convey- 

1.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  Makes  no 
material  change  in  this  provision  as  enacted  by  chapter  908,  Laws  1896. 


REPORTS  OF   SURROGATE  AND  OTHERS.  385 

ance  filed  or  recorded  in  his  office,  of  any  property,  which  ap- 
pears to  have  been  made  or  intended  to  take  effect  in  posses- 
sion or  enjoyment  after  the  death  of  the  grantor  or  vendor, 
with  the  name  and  place  of  residence  of  snch  grantor  or 
vendor,  the  name  and  place  of  residence  of  the  grantee  or 
vendee,  and  a  description  of  the  property  transferred,  which 
shall  be  immediately  forwarded  to  the  state  comptroller.1 

496.  Corresponding  Section  of  Former  Acts  Relating  to  Re- 

ports of  Surrogate  and  County  Clerk. 

Section  18  of  the  Laws  of  1885  provided  that  the 
surrogate  and  county  clerk  shall,  every  three  months, 
make  a  report  showing  the  property  or  persons  from 
whom  any  tax  is  believed  to  be  due  and  unpaid.  Sec- 
tion 19  of  chapter  399,  Laws  1892,  in  effect  May  1st  of 
that  year,  provided  that  such  reports  should  be  made 
in  duplicate,  and  this  provision  was  substantially  re- 
enacted  in  section  239  of  chapter  908,  Laws  1896,  in 
effect  June  15th  of  that  year. 

By  chapter  173,  Laws  1901,  in  effect  April  1st  of 
that  year,  section  239  was  amended  by  providing  that 
in  counties  where  the  office  of  appraiser  was  salaried 
but  one  copy  of  each  report  need  be  made.  This  pro- 
vision was  substantially  re-enacted  in  section  239  of 
chapter  368,  Laws  1905,  in  effect  June  1st  of  that  year. 

497.  Reports  of  County  Treasurer. 

[§  240,  Tax  Law.]  Each  county  treasurer  in  a  county 
in  which  the  office  of  appraiser  is  not  salaried  shall  make  a 

1.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  Makes  no 
material  change  in  this  provision  as  enacted  by  chapter  908,  Laws  1896, 
as  amended  by  chapter  173,  Laws  1901,  except  that  the  reports  are  not 
now  required  to  be  made  in  duplicate. 

25 


386  THE   LAW    OF    TAXABLE   TRANSFERS. 

report,  under  oath,  to  the  state  comptroller,  on  January, 
April,  July  and  October  first  of  each  year,  of  all  taxes  re- 
ceived by  him  under  this  article,  stating  for  what  estate  and 
by  whom  and  when  paid.  The  form  of  such  report  may 
be  prescribed  by  the  state  comptroller.  He  shall,  at  the 
same  time,  pay  the  state  treasurer  all  taxes  received  by  him 
under  this  article  and  not  previously  paid  into  the  state 
treasury,  and  for  all  such  taxes  collected  by  him  and  not 
paid  into  the  state  treasury  within  thirty  days  from  the 
times  herein  required,  he  shall  pay  interest  at  the  rate  of  ten 
per  centum  per  annum.1 

488.  Corresponding  Sections  of  Former  Acts  Relating  to  Re- 
ports of  County  Treasurer. 

Section  21  of  the  Act  of  1885  provided  that  the 
treasurer  of  each  county  and  the  comptroller  of  the 
county  of  New  York,  on  the  first  Monday  of  March 
and  September  of  each  year,  should  make  a  report  un- 
der oath  of  all  taxes  collected  under  that  act. 

Section  20  of  chapter  399,  Laws  1892,  in  effect  May 
1st  of  that  year,  substantially  re-enacted  the  above 
provisions,  except  that  such  reports  were  required  to 
be  made  quarterly  instead  of  semi-annually. 

This  provision  was  re-enacted  in  section  240  of  chap- 
ter 908,  Laws  1896,  in  effect  June  15th  of  that  year, 
and  amended  by  chapter  173,  Laws  1901,  in  effect  April 
1st  of  that  year,  providing  that  the  provisions  thereof 
should  not  apply  to  the  county  treasurers  in  the  coun- 
ties where  there  were  salaried  appraisers. 

This  provision  was  re-enacted  in  section  240  of 
chapter  368,  Laws  1905,  in  effect  June  1st  of  that  year. 

1.  Chapter  363,  Laws  1905  —  in  effect  June  1  of  that  year. —  Makes 
no  change  in  this  section,  as  enacted  by  chapter  908,  Laws  1896,  as 
amended  by  chapter  173,  Laws  1901. 


REPORT    OF   STATE    COMPTROLLER.  387 

499.  Report  of  State  Comptroller;  Payment  of  Taxes. 

[§  240-a,  Tax  Law.]  The  state  comptroller  shall  deposit 
all  taxes  collected  by  him  under  this  article  in  a  responsible 
bank,  banking  house  or  trust  company  in  the  city  of  Albany, 
which  shall  pay  the  highest  rate  of  interest  to  the  state  for 
such  deposit,  to  the  credit  of  the  state  comptroller  on  account 
of  the  transfer  tax.  And  every  such  bank,  banking  house  or 
trust  company,  shall  execute  and  file  in  his  office  an  under- 
taking to  the  state,  in  the  sum,  and  with  such  sureties,  as  are 
required  and  approved  by  the  comptroller,  for  the  safe  keep- 
ing and  prompt  payment  on  legal  demand  therefor  of  all 
such  moneys  held  by  or  on  deposit  in  such  bank,  banking 
house  or  trust  company,  with  interest  thereon  on  daily  bal- 
ances at  such  rate  as  the  comptroller  may  fix.  Every  such 
undertaking  shall  have  endorsed  thereon,  or  annexed  thereto, 
the  approval  of  the  attorney-general  as  to  its  form.  The 
state  comptroller  shall  on  the  first  day  of  each  month  make 
a  verified  return  to  the  state  treasurer  of  all  taxes  received 
by  him  under  this  article,  stating  for  what  estate,  and  by 
whom  and  when  paid ;  and  shall  credit  himself  with  all  ex- 
penditures made  since  his  last  previous  return  on  account 
of  such  taxes,  for  salary,  refunds,  or  other  purposes  lawfully 
chargeable  thereto.  He  shall  at  the  same  time  pay  to  the 
state  treasurer  the  balance  of  such  taxes  remaining  in  his 
hands  at  the  close  of  business  on  the  last  day  of  the  previous 
month,  as  appears  from  such  returns.1 

500.  Corresponding  Sections  of  Former  Acts  Relating  to  Re- 

port of  State  Comptroller,  Etc. 

This  provision  was  added  to  chapter  908,  Laws  1896, 
by  chapter  173,  Laws  1901,  in  effect  April  1st  of  that 

1.  Chap.  173,  Laws  1901  —  in  effect  April  1  of  that  year.—  First 
added  this  provision  as  a  new  section  to  the  Transfer  Tax  Law. 

Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year.— Makes  no 
material  change  in  this  section  —  the  words  "as  in  the  opinion  of  the 
Comptroller  are  secure"  which  immediately  followed  the  word  "Al- 
bany"  in  the  Act  of  1901    (third  line  in  section  240-a)   being  omitted. 


388        THE  LAW  OF  TAXABLE  TRANSFERS. 

year,  and  was  substantially  re-enacted  in  section  240-a 
of  chapter  368,  Laws  1905,  in  effect  June  1st  of  that 
year. 

501.  Application  of  Taxes. 

[§  241,  Tax  Law.]  All  taxes  levied  and  collected  under 
this  article  when  paid  into  the  treasury  of  the  state  shall  be 
applicable  to  the  expenses  of  the  state  government  and  to  such 
other  purposes  as  the  legislature  shall  by  law  direct.1 

502.  Corresponding  Sections  of  Former  Acts  Relating  to  Ap- 

plication of  Taxes. 

Section  24  of  the  Act  of  1885  directed  that  all  taxes 
collected  under  this  act  should  be  paid  into  the  State 
treasury. 

This  provision  was  re-enacted  in  section  21  of  chap- 
ter 399,  Laws  1892,  in  effect  May  1st  of  that  year ;  sec- 
tion 241  of  chapter  908,  Laws  1896,  in  effect  June  15th 
of  that  year,  and  section  241  of  chapter  368,  Laws 
1905,  in  effect  June  1st  of  that  year. 

1.  Chap.  368,  Laws  1905  —  in  effect  June  1  of  that  year. —  Makes  no 
change  in  this  section. 


CHAPTER  XXI. 


Definitions  —  Exemptions  in  Article  One  not 
Applicable. 


f»03.  Definitions. 

504.  The      words      "  estate "      and 

"  property  "  defined. 

505.  The  word  "  estate "  as  inter- 

preted prior  to  1892. 

506.  Same  construction  in  reference 

to      property      passing      to 
lineals  and  others. 

507.  What   included   in   the   defini- 

tion of  the  word  "  property." 


508.  Property     exempted     by     the 

definition  in  1892. 

509.  Meaning  of  "  transfer." 

510.  There  is  no  "  transfer "  by 
will  unless  legacy  is  accepted. 
Exemptions   in    article    1    not 

applicable. 
First  included  in  the  Transfer 
Tax  Law,  in  1900. 


511. 


.1-2. 


503.  Definitions. 

[§  242,  Tax  Law.]  The  words  "  estate  "  and  "  property," 
as  used  in  this  article,  shall  be  taken  to  mean  the  property 
or  interest  therein  of  the  testator,  intestate,  grantor,  bar- 
gainor or  vendor,  passing  or  transferred  to  those  not  herein 
specifically  exempted  from  the  provisions  of  this  article, 
and  not  as  the  property  or  interest  therein  passing  or  trans- 
ferred to  individual  legatees,  devisees,  heirs,  next  of  kin, 
grantees,  donees  or  vendees,  and  shall  include  all  property 
or  interest  therein,  whether  situated  within  or  without  this 
state.1  The  word  "  transfer,"  as  used  in  this  article,  shall 
be  taken  to  include  the  passing  of  property  or  any  interest 
therein  in  possession  or  enjoyment,  present  or  future,  by  in- 

1.  Chap.  399,  Laws  1892  —  in  effect  May  1  of  that  year.—  Section  22 
first  enacted  this  provision,  including  at  the  end  thereof  the  words 
"  over  which  this  State  has  any  jurisdiction  for  the  purposes  of  tax- 
ation." 

Chap.  908,  Laws  189G  —  in  effect  June  15  of  that  year.— Section  242 
re-enacted  this  provision  without  amendment. 

Chap.  88,  Laws  1898  — in  effect  March  21. —  Amended  former  section 
242  by  omitting  the  words  quoted  in  note  1. 

Chap.  3(>H,  Laws  1905  —  in  effect  June  1  of  that  year.— Re-enacts  this 
provision  as  amended  in  1898. 

[389] 


390  THE   LAW    OF    TAXABLE    TRANSFERS. 

heritance,  descent,  devise,  bequest,  grant,  deed,  bargain,  sale 
or  gift,  in  the  manner  herein  prescribed.  The  words  "  county 
treasurer "  and  "  district  attorney,"  as  used  in  this  article, 
shall  be  taken  to  mean  the  treasurer  or  the  district  attorney 
of  the  county  of  the  surrogate  having  jurisdiction  as  pro- 
vided in  section  two  hundred  and  twenty-eight  of  this  article.2 

504.  The  Words  "  Estate  "  and  "  Property  "  Defined. 

By  section  22  of  the  Act  of  1892  the  Legislature  first 
attempted  to  define  the  words  "  estate,"  "  property," 
and  "  transfer."  By  section  242  of  chapter  908,  Laws 
1896,  in  effect  June  15th  of  that  year,  re-enacted  the 
provisions  of  section  22,  and  further  construed  the 
words  "  county  treasurer,"  "  Comptroller,"  and 
"  district  attorney  "  as  used  in  this  article. 

By  chapter  88,  Laws  1898,  in  effect  March  21st  of 
that  year,  section  242  was  amended  by  omitting  from 
the  definition  of  "  property  "  the  words  "  over  which 
this  State  has  any  jurisdiction  for  the  purpose  of  tax- 
ation," which  appeared  in  the  last  part  of  the  first 
sentence  in  section  242  aforesaid.  By  chapter  173, 
Laws  1901,  in  effect  April  1st  of  that  year,  the  word 
"  Comptroller  "  was  stated  to  mean  the  State  Comp- 
troller. Section  242,  as  amended,  was  re-enacted  in 
section  242  by  chapter  368,  Laws  1905,  in  effect  June 
1,  1905. 

505.  The  Word  "  Estate  "  as  Interpreted  Prior  to  1892. 
Prior  to  the  Act  of  1892,  the  courts  had  decided  that 

the  word  ' '  estate, ' '  to  which  the  limitation  of  $500  was 

2.  Chap.  399,  Laws  1892  —  in  effect  May  1  of  that  year. —  Section  22 
first  enacted  this  provision  substantially  as  it  appears  above,  except 
that  by  chapter  368,  Laws  1905,  the  word  "  Comptroller  "  is  omitted 
from  the  words  defined. 


ESTATE   AND    PROPERTY   DEFINED.  391 

attached,  must  necessarily  mean  the  estate  received  by 
the  particular  successors,  and  not  that  of  the  testator 
or  intestate  upon  which,  as  such  and  in  the  aggregate, 
no  tax  was  imposed.  Matter  of  Cager,  111  N.  Y.  344; 
Matter  of  Howe,  112  N.  Y.  100;  Matter  of  Sterling,  9 
Misc.  Rep.  224,  30  N.  Y.  S.  385. 

506.  Same  Construction  in  Reference  to  Property  Passing  to 
Lineals  and  Others. 

By  the  amendment  to  section  1  of  the  Act  of  1885, 
by  chapter  215,  Laws  1891,  in  effect  April  20th  of  that 
year,  the  statute  was  extended  so  as  to  include  within 
its  operation  shares  and  interests  passing  to  lineals 
and  others  named  in  the  statute,  although  the  rate  of 
taxation  to  such  persons  was  less,  and  a  limitation  im- 
posed applying  the  tax  only  where  the  personal  prop- 
erty exceeded  in  value  the  sum  of  $10,000.  This  pro- 
vision raised  the  same  question  as  to  lineals  which  had 
previously  been  determined  as  to  collaterals,  namely, 
which  property  was  meant,  whether  that  passing  from 
the  decedent  or  that  passing  to  the  particular  suc- 
cessor, and  by  general  consent  it  was  determined  in 
the  same  way  and  held  to  mean  the  specific  share  pass- 
ing to  the  successor. 

In  the  Matter  of  Hoffman,  143  N.  Y.  327,  in  proceed- 
ings under  the  Act  of  1892,  the  Court  of  Appeals  de- 
cided that  under  the  provisions  of  section  22  of  the  Act 
of  1892  (now  §  242),  the  limitations  applied  to  the 
aggregate  value  of  all  the  property  so  transferred  by 
a  decedent,  and  not  to  the  separate  value  of  each  sev- 
eral transfer.     See  also  Matter  of  Hallock,  42  Misc. 


392        THE  LAW  OF  TAXABLE  TRANSFERS. 

Rep.  473,  87  N.  Y.  S.  255;  Matter  of  Fisher,  96  App. 
Div.  133,  89  N.  Y.  S.  102,  since  the  enactment  of  chap- 
ter 41,  Laws  1903,  first  taxing  the  transfer  of  real 
property  to  the  1-per  cent  class. 

507.  What  Included  in  the  Definition  of  the  Word  "Prop- 

erty." 

In  the  Matter  of  Hellman,  174  N.  Y.  254,  the  court 
said  that  the  definition  of  the  personal  property  upon 
which  the  transfer  tax  is  imposed  is  not  that  of  sub- 
division 5  of  section  2  of  the  Tax  Law  *  *  *  but  is 
that  contained  in  section  242,  in  the  article  relating  to 
taxable  transfers  and  applicable  to  the  transfer  tax 
alone,  which  provides  that  the  words  "  estate  "  and 
"  property,"  as  used  in  this  article     *     *  shall 

include  all  property  or  interest  therein,  whether  situ- 
ated within  or  without  this  State ;  and  therefore  a  seat 
in  the  New  York  Stock  Exchange  being  "  property  ' 
within  the  meaning  of  this  definition,  is  subject  to  a 
transfer  tax  upon  the  death  of  the  owner  thereof. 

508.  Property  Exempted  by  the  Definition  in  1892. 

In  the  Matter  of  Sherman,  153  N.  Y.  1,  the  court 
held  that  United  States  bonds,  owned  by  a  resident 
decedent,  which  would  otherwise  be  subject  to  valua- 
tion for  the  purpose  of  fixing  the  tax  under  the  Trans- 
fer Tax  Act  of  1892,  are  exempt  from  such  valuation 
by  force  of  the  provision  which  limits  the  meaning  of 
the  words  "  estate  "  and  "  property,"  as  used  in  that 
act,  to  property  over  which  the  State  has  jurisdiction 


MEANING   OF    TRANSFER.  393 

for  the  purposes  of  taxation.  This  decision  was  handed 
down  May  4,  1897,  and  the  next  year  section  242  was 
amended  (chap.  88,  Laws  1898,  supra)  by  striking  from 
the  provision  of  this  section  the  words  "  over  which 
the  State  has  any  jurisdiction  for  the  purpose  of  tax- 
ation." 

After  March  21,  1898,  a  transfer  of  United  States 
bonds  was  again  held  taxable.  Matter  of  Plummer,  30 
Misc.  Rep.  19,  62  N.  Y.  S.  1024;  affd.,  47  App.  Div.  625, 
62  N.  Y.  S.  1145,  161  N.  Y.  631,  on  the  authority  of 
Matter  of  Sherman,  153  N.  Y.  1;  Plummer  v.  Coler, 
178  U.  S.  115. 

509.  Meaning  of  "  Transfer." 

In  the  Matter  of  Gould,  156  N.  Y.  423,  the  court  said 
the  word  "  transfer,"  in  the  act  relating  to  taxable 
transfers  of  property,  is  used  in  its  ordinary  legal 
signification,  namely,  "  that  the  owner  of  a  thing  de- 
livers it  to  another  with  the  intent  of  passing  the 
rights  which  he  has  in  it  to  the  latter." 

510.  There  is  no  "Transfer"  by  Will,  Unless  Legacy  is  Ac- 

cepted. 

In  the  Matter  of  Wolfe,  89  App.  Div.  349,  85  N.  Y.  S. 
949,  where  a  legatee  in  the  5-per  cent,  class  refused 
his  legacy,  and  the  surrogate  had  nevertheless  im- 
posed a  tax  upon  the  gift  at  that  rate,  on  the  ground 
that  the  transfer  took  place  at  the  moment  of  the  de- 
cedent's death,  and  all  the  legatee  could  renounce  was 
the  legacy,  less  the  transfer  tax  thereon,  which  was 
properly  deductible  from  said  legacy.    The  court  held, 


394  THE   LAW   OF   TAXABLE   TRANSFERS. 

in  reversing  the  order  of  the  surrogate,  after  quoting 
from  the  definition  of  the  word  "  transfer,"  as  defined 
in  section  242,  supra,  that  "  the  transfer  tax  there- 
fore, which  is  the  basis  of  the  subject  of  this  con- 
troversy, must  be  regarded  as  a  tax,  not  upon  the 
money  which  is  the  subject  of  the  legacy,  but  upon  the 
passing  of  that  money  under  the  will  in  possession  or 
enjoyment  *  *  *.  It  is  solely  upon  the  transfer, 
that  is  to  say,  upon  the  change  in  title  or  ownership. 
If  no  transfer  is  effected  because  *  *  *  the  legatee 
renounces  the  gift  and  refuses  to  accept  it,  no  tax  can 
be  collected  with  respect  to  him,  because  there  has  been 
no  transfer  to  him."  This  case  was  affirmed  on  opin- 
ion below,  in  179  N.  Y.  599. 

511.  Exemptions  in  Article  One  not  Applicable. 

[§  243,  Tax  Law.]  The  exemptions  enumerated  in  sec- 
tion four  of  the  tax  law,  of  which  this  article  is  a  part,  shall 
not  be  construed  as  being  applicable  in  any  manner  to  the 
provisions  of  article  ten  hereof.1 

512.  First  Included  in  the  Transfer  Tax  Law  in  1900. 

This  provision  was  added  to  article  10  of  the  Tax 
Law  by  chapter  382,  Laws  1900,  in  effect  April  11th  of 
that  year,  and  was  re-enacted  by  chapter  368,  Laws 
1905,  in  effect  June  1st  of  that  year. 

The  effect  of  this  section  was  to  render  taxable,  lega- 
cies  to  various  corporations   and  institutions  which 

1.  Chap.  382,  Laws  1900  —  in  effect  April  11  of  that  year. —  First 
iidded  this  provision  as  a  new  section  to  the  Transfer  Tax  Law. 

Chap.  368,  Laws  1905. —  In  effect  June  1  of  that  year.  Makes  no 
change  therein. 


CERTAIN   EXEMPTIONS   NOT   APPLICABLE.  395 

were  exempt  from  taxation  under  section  4  of  article  1 
of  the  Tax  Law,  since  article  10,  relating  to  taxable 
transfers,  became  a  part  of  the  General  Tax  Law  by 
chapter  908,  Laws  1896.  Matter  of  Watson,  171  N.  Y. 
256. 

Exemption  has  been  extended,  however,  by  various 
amendments  to  section  221,  supra,  so  as  to  exempt 
many  of  the  corporations  and  institutions  previously 
taxable. 


APPENDIX. 


APPENDIX. 


i. 

The  Statute  of  Distribution. 

The  personal  property  of  all  resident  decedents,  after  the 
payment  of  debts,  funeral,  testamentary,  or  administration 
expenses,  commissions,  etc.,  if  not  disposed  of  by  will,  must 
be  distributed  according  to  section  2732  of  the  Code  of  Civil 
Procedure,  which  is  as  follows: 

Order  of  Distribution. 

If  the  deceased  died  intestate,  the  surplus  of  his  personal 
property  after  payment  of  debts ;  and  if  he  left  a  will,  such 
surplus,  after  the  payment  of  debts  and  legacies,  if  not  be- 
queathed, must  be  distributed  to  his  widow,  children,  or 
next  of  kin,  in  manner  following : 

1.  One-third  part  to  the  widow,  and  the  residue  in  equal 
portions  among  the  children,  and  such  persons  as  legally 
represent  the  children,  if  any  of  them  have  died  before  the 
deceased. 

2.  If  there  be  no  children,  nor  any  legal  representatives 
of  them,  then  one-half  of  the  whole  surplus  shall  be  allotted 
to  the  widow,  and  the  other  half  distributed  to  the  next  of 
kin  of  the  deceased,  entitled  under  the  provisions  of  this 
section. 

3.  If  the  deceased  leaves  a  widow  and  no  descendant, 
parents,  brother  or  sister,  nephew  or  niece,  the  widow  shall 
be  entitled  to  the  whole  surplus,  but  if  there  be  a  brother 
or  sister,  nephew  or  niece,  and  no  descendant  or  parent,  the 
widow  shall  be  entitled  to  one-half  of  the  surplus  as  above 
provided,   and  to  the  whole  of  the  residue,  if  it  does  not 

[399] 


400  APPENDIX. 

exceed  two  thousand  dollars;  if  the  residue  exceeds  that  sum, 
she  shall  receive,  in  addition  to  the  one-half,  two  thousand 
dollars  ;  and  the  remainder  shall  be  distributed  to  the  brothers 
and  sisters  and  their  representatives. 

4.  If  there  be  no  widow,  the  whole  surplus  shall  be  dis- 
tributed equally  to  and  among  the  children,  and  such  as 
legally  represent  them. 

5.  If  there  be  no  widow,  and  no  children,  and  no  repre- 
sentatives of  a  child,  the  whole  surplus  shall  be  distributed 
to  the  next  of  kin,  in  equal  degree  to  the  deceased,  and  their 
legal  representatives ;  and  if  all  the  brothers  and  sisters  of 
the  intestate  be  living,  the  whole  surplus  shall  be  distributed 
to  them;  if  any  of  them  be  living  and  any  be  dead,  to  the 
brothers  and  sisters  living,  and  the  descendants  in  whatever 
degree  of  those  dead ;  so  that  to  each  living  brother  or  sister 
shall  be  distributed  such  share  as  would  have  been  distributed 
to  him  or  her  if  all  the  brothers  and  sisters  of  the  intestate 
who  shall  have  died  leaving  issue  had  been  living,  and  so 
that  there  shall  be  distributed  to  such  descendants  in  what- 
ever degree,  collectively,  the  share  which  their  parent  would 
have  received  if  living;  and  the  same  rule  shall  prevail  as 
to  all  direct  lineal  descendants  of  every  brother  and  sister  of 
the  intestate  whenever  such  descendants  are  of  unequal 
degrees. 

6.  If  the  deceased  leave  no  children,  and  no  representative 
of  them,  and  no  father,  and  leave  a  widow  and  a  mother,  the 
half  not  distributed  to  the  widow  shall  be  distributed  in 
equal  shares  to  his  mother  and  brothers  and  sisters,  or  the 
representatives  of  such  brothers  and  sisters ;  and  if  there  be 
no  widow,  the  whole  surplus  shall  be  distributed  in  like  man- 
ner to  the  mother,  and  to  the  brothers  and  sisters,  or  the 
representatives  of  such  brothers  and  sisters. 

7.  If  the  deceased  leave  a  father  and  no  child  or  descendant 
the  father  shall  take  one-half  if  there  be  a  widow,  and  the 
whole  if  there  be  no  widow. 

8.  If  the  deceased  leave  a  mother,  and  no  child  or  de- 
scendant, father,  brother,  sister,  or  representative  of  a  brother 


APPENDIX.  401 

or  sister,  the  mother,  if  there  be  a  widow,  shall  take  one- 
half  ;  and  the  whole  if  there  be  no  widow. 

9.  If  the  deceased  was  illegitimate  and  leave  a  mother, 
and  no  child,  or  descendant,  or  widow,  such  mother  shall 
take  the  whole  and  shall  be  entitled  to  letters  of  administra- 
tion in  exclusion  of  all  other  persons.  If  the  mother  of  such 
deceased  be  dead,  the  relatives  of  the  deceased  on  the  part 
of  the  mother  shall  take  in  the  same  manner  as  if  the  de- 
ceased had  been  legitimate,  and  be  entitled  to  letters  of 
administration  in  the  same  order. 

10.  Where  the  descendants  or  next  of  kin  of  the  deceased, 
entitled  to  share  in  his  estate,  are  all  in  equal  degree  to  the 
deceased,  their  shares  shall  be  equal. 

11.  When  such  descendants  or  next  of  kin  are  of  unequal 
degrees  of  kindred,  the  surplus  shall  be  apportioned  among 
those  entitled  thereto,  according  to  their  respective  stocks; 
so  that  those  who  take  in  their  own  right  shall  receive  equal 
shares,  and  those  who  take  by  representation  shall  receive 
the  shares  to  which  the  parent  whom  they  represent,  if  living, 
would  have  been  entitled. 

12.  Xo  representation  shall  be  admitted  among  collaterals 
after  brothers'  and  sisters'  descendants. 

This  act  shall  not  apply  to  an  estate  of  a  decedent  who 
shall  have  died  prior  to  the  time  this  act  shall  take  effect. 

13.  Relatives  of  the  half-blood  shall  take  equally  with 
those  of  the  whole  blood  in  the  same  degree ;  and  the  repre- 
sentatives of  such  relatives  shall  take  in  the  same  manner 
as  the  representatives  of  the  whole  blood. 

14.  Descendants  and  next  of  kin  of  the  deceased,  begotten 
before  his  death,  but  born  thereafter,  shall  take  in  the  same 
manner  as  if  they  had  been  born  in  the  lifetime  of  the  de- 
ceased, and  had  survived  him. 

15.  If  a  woman  die,  leaving  illegitimate  children,  and  no 
lawful  issue,  such  children  inherit  her  personal  property  as 
if  legitimate. 

16.  If  there  be  no  husband  or  wife  surviving  and  no 
children,  and  no  representatives  of  a  child,  and  no  next  of 

26 


402  APPENDIX. 

kin,  then  the  whole  surplus  shall  be  distributed  equally  to 
and  among  the  next  of  kin  of  the  husband  or  wife  of  the 
deceased,  as  the  case  may  be,  and  such  next  of  kin  shall  be 
deemed  next  of  kin  of  the  deceased  for  all  the  purposes 
specified  in  this  chapter;  but  such  surplus  shall  not,  and 
shall  not  be  construed  to,  embrace  any  personal  property 
except  such  as  was  received  by  the  deceased  from  such  hus- 
band or  wife,  as  the  case  may  be,  by  will  or  by  virtue  of  the 
laws  relating  to  the  distribution  of  the  personal  property  of 
the  deceased  person.  (Section  2732  of  the  Code  of  Civil 
Procedure,  as  amended  by  chapter  539  of  the  Laws  of  1905, 
in  effect  May  18th  of  that  year.) 

II. 

The  Estates  of  Married  Women. 

§  2734.  Estates  of  married  women. —  The  provisions  of 
this  article  respecting  the  distribution  of  property  of  de- 
ceased persons  apply  to  the  personal  property  of  married 
women  dying,  leaving  descendants  them  surviving.  The 
husband  of  any  such  deceased  married  woman  shall  be  en- 
titled to  the  same  distributive  share  in  the  personal  property 
of  his  wife  to  which  a  widow  is  entitled  in  the  personal 
property  of  her  husband  by  the  provisions  of  this  article 
and  no  more.  (Section  2734  of  the  Code  of  Civil  Pro- 
cedure.) 

III. 

The  Statute  of  Descent. 

The  Statute  of  Descent  is  embodied  in  the  Real  Property 
Law,  chapter  547  of  the  Laws  of  1896,  sections  280-296. 
Section  280  defines  the  terms  "  real  property  "  and  "  inherit- 
ance," and  contains  the  rules  for  interpreting  the  provisions 
of  this  article.  The  sections  referring  particularly  to  the 
descent  of  real  property  are  as  follows : 

§  281.  General  rule  of  descent. —  The  real  property  of  a 
person  who  dies  without  devising  the  same  shall  descend : 
1.  To  his  lineal  descendants. 


APPENDIX.  403 

2.  To  his  father. 

3.  To  his  mother;  and 

4.  To  his  collateral  relatives, 

as  prescribed  in  the  following  sections  of  this  article : 

§  282.  Lineal  descendants  of  equal  degree. —  If  the  in- 
testate leave  descendants  in  the  direct  line  of  lineal  descent, 
all  of  equal  degree  of  consanguinity  to  him,  the  inheritance 
shall  descend  to  them  in  equal  parts,  however  remote  from 
him  the  common  degree  of  consanguinity  may  be. 

§  283.  Lineal  descendants  of  unequal  degree. —  If  any  of 
the  descendants  of  such  intestate  be  living,  and  any  be  dead, 
the  inheritance  shall  descend  to  the  living,  and  the  descend- 
ants of  the  dead,  so  that  each  living  descendant  shall  inherit 
such  share  as  would  have  descended  to  him  had  all  the  de- 
scendants in  the  same  degree  of  consanguinity  who  shall 
have  died  leaving  issue  been  living ;  and  so  that  issue  of  the 
descendants  who  shall  have  died  shall  respectively  take  the 
shares  which  their  ancestors  would  have  received. 

§  284.  When  father  inherits. —  If  the  intestate  die  with- 
out lawful  descendants,  and  leave  a  father,  the  inheritance 
shall  go  to  such  father,  unless  the  inheritance  came  to  the 
intestate  on  the  part  of  his  mother,  and  she  be  living ;  if  she 
be  dead,  the  inheritance  descending  on  her  part  shall  go  to 
the  father  for  life,  and  the  reversion  to  the  brothers  and 
sisters  of  the  intestate  and  their  descendants,  according  to 
the  law  of  inheritance  by  collateral  relatives  hereinafter  pro- 
vided;  if  there  be  no  such  brothers  or  sisters  or  their  de- 
scendants living,  such  inheritance  shall  descend  to  the  father 
in  fee. 

§  285.  When  mother  inherits. —  If  the  intestate  die  with- 
out descendant  and  leave  no  father,  or  leave  a  father  not 
entitled  to  take  the  inheritance  under  the  last  section,  and 
leave  a  mother,  and  a  brother  or  sister,  or  the  descendant  of 
a  brother  or  sister,  the  inheritance  shall  descend  to  the  mother 
for  life,  and  the  reversion  to  sue}]  brothers  and  sisters  of  the 
intestate  as  may  be  living,  and  the  descendants  of  such  as 
may  be  dead,  according  to  the  same  law  of  inheritance  here- 


404  APPENDIX. 

inafter  provided.  If  the  intestate  in  such  case  leave  no 
brother  or  sister  or  descendant  thereof,  the  inheritance  shall 
descend  to  the  mother  in  fee. 

§  286.  When  collateral  relatives  inherit;  collateral  rela- 
tives of  equal  degree. —  If  there  be  no  father  or  mother 
capable  of  inheriting  the  estate,  it  shall  descend  in  the  cases 
hereinafter  specified  to  the  collateral  relatives  of  the  in- 
testate; and  if  there  be  several  such  relatives,  all  of  equal 
degree  of  consanguinity  to  the  intestate,  the  inheritance  shall 
descend  to  them  in  equal  parts,  however  remote  from  him 
the  common  degree  of  consanguinity  may  be. 

§  287.  Brothers  and  sisters  and  their  descendants. —  If  all 
the  brothers  and  sisters  of  the  intestate  be  living,  the  in- 
heritance shall  descend  to  them;  if  any  of  them  be  living 
and  any  be  dead,  to  the  brothers  and  sisters  living,  and  the 
descendants,  in  whatever  degree,  of  those  dead ;  so  that  each 
living  brother  or  sister  shall  inherit  such  share  as  would  have 
descended  to  him  or  her  if  all  the  brothers  and  sisters  of  the 
intestate  who  shall  have  died,  leaving  issue,  had  been  living, 
and  so  that  such  descendants  in  whatever  degree  shall  col- 
lectively inherit  the  share  which  their  parent  would  have 
received  if  living;  and  the  same  rule  shall  prevail  as  to  all 
direct  lineal  descendants  of  every  brother  and  sister  of  the 
intestate  whenever  such  descendants  are  of  unequal  degrees. 

§  288.  Brothers  and  sisters  of  father  and  mother  and  their 
descendants  and  grandparents. —  If  there  be  no  heir  entitled 
to  take,  under  either  of  the  preceding  sections,  the  inherit- 
ance, if  it  shall  have  come  to  the  intestate  on  the  part  of  the 
father,  shall  descend: 

1.  To  the  brothers  and  sisters  of  the  father  of  the  intestate 
in  equal  shares,  if  all  be  living. 

2.  If  any  be  living,  and  any  shall  have  died,  leaving  issue, 
to  such  brothers  and  sisters  as  shall  be  living  and  to  the 
descendants  of  such  as  shall  have  died. 

3.  If  all  such  brothers  and  sisters  shall  have  died,  to  their 
descendants. 

4.  If  there  be  no  such  brothers  or  sisters  of  such  father,  nor 


APPENDIX. 


405 


any  descendants  of  such  brothers  or  sisters,  to  the  brothers 
and  sisters  of  the  mother  of  the  intestate,  and  to  the  de- 
scendants of  such  as  shall  have  died,  or  if  all  have  died,  to 
their  descendants.  But,  if  the  inheritance  shall  have  come 
to  the  intestate  on  the  part  of  his  mother,  it  shall  descend  to 
her  brothers  and  sisters  and  their  descendants ;  and  if  there 
be  none,  to  the  brothers  and  sisters  of  the  father  and  their 
descendants,  in  the  manner  aforesaid.  If  the  inheritance 
has  not  come  to  the  intestate  on  the  part  of  either  father  or 
mother,  it  shall  descend  to  the  brothers  and  sisters  both  of 
the  father  and  mother  of  the  intestate,  and  their  descendants 
in  the  same  manner.  In  all  cases  mentioned  in  this  section, 
the  inheritance  shall  descend  to  the  brothers  and  sisters  of 
the  intestate's  father  or  mother,  as  the  case  may  be,  or  to 
their  descendants  in  like  manner  as  if  they  had  been  the 
brothers  and  sisters  of  the  intestate. 

5.  If  there  be  no  such  brothers  or  sisters  of  such  father  or 
mother,  nor  any  descendants  of  such  brothers  or  sisters,  the 
inheritance,  if  it  shall  have  come  to  the  intestate  on  the  part 
of  his  father,  shall  descend  to  his  father's  parents,  then  liv- 
ing, in  equal  parts,  and  if  they  be  dead,  then  to  his  mother's 
parents,  then  living,  in  equal  parts;  but  if  the  inheritance 
shall  have  come  to  the  intestate  on  the  part  of  his  mother, 
it  shall  descend  to  his  mother's  parents,  then  living,  in  equal 
parts,  and  if  they  be  dead,  to  his  father's  parents,  then  liv- 
ing, in  equal  parts.  If  the  inheritance  has  not  come  to  the 
intestate  on  the  part  of  either  father  or  mother,  it  shall  de- 
scend to  his  living  grandparents  in  equal  parts.  (As 
amended  by  chapter  106  of  the  Laws  of  1904,  in  effect 
March  22d  of  that  year.) 

§  289.  Illegitimate  children. —  If  an  intestate  who  shall 
have  been  illegitimate  die  without  lawful  issue,  or  illegiti- 
mate issue  entitled  to  take,  under  this  section,  the  inheritance 
shall  descend  to  his  mother ;  if  she  be  dead,  to  his  relatives 
on  her  part,  as  if  he  had  been  legitimate. 

If  a  woman  die  without  lawful  issue,  leaving  an  illegiti- 
mate child,  the  inheritance  shall  descend  to  him  as  if  he  were 
legitimate. 


406  APPENDIX. 

In  any  other  case  illegitimate  children  or  relatives  shall 
not  inherit. 

§  290.  Relatives  of  the  half-blood. —  Relatives  of  the  half- 
blood  and  their  descendants  shall  inherit  equally  with  those 
of  the  whole  blood  and  their  descendants,  in  the  same  degree, 
unless  the  inheritance  came  to  the  intestate  by  descent,  de- 
vise or  gift  from  an  ancestor ;  in  which  case  all  those  who 
are  not  of  the  blood  of  such  ancestor  shall  be  excluded  from 
such  inheritance. 

§  290-a.  Intestacy  where  inheritance  comes  from  deceased 
husband  or  wife. —  When  the  inheritance  shall  have  come  to 
the  intestate  from  a  deceased  husband  or  wife,  as  the  case 
may  be,  and  there  be  no  person  entitled  to  inherit  under  any 
of  the  preceding  sections,  then  such  real  property  of  such 
intestate  shall  descend  to  the  heirs  of  such  deceased  husband 
or  wife,  as  the  case  may  be,  and  the  persons  entitled,  under 
the  provisions  of  this  section,  to  inherit  such  real  property, 
shall  be  deemed  to  be  the  heirs  of  such  intestate. 

§  291.  Cases  not  hereinbefore  provided  for. —  In  all  cases 
not  provided  for  by  the  preceding  sections  of  this  article,  the 
inheritance  shall  descend  according  to  the  course  of  the 
common  law. 

§  292.  Posthumous  children  and  relatives. —  A  descendant 
or  a  relative  of  the  intestate  begotten  before  his  death,  but 
born  thereafter,  shall  inherit  in  the  same  manner  as  if  he  had 
been  born  in  the  lifetime  of  the  intestate  and  had  survived 
him. 

§  293.  Inheritance,  sole  or  in  common. —  When  there  is 
but  one  person  entitled  to  inherit,  he  shall  take  and  hold  the 
inheritance  solely ;  when  an  inheritance  or  a  share  of  an 
inheritance  descends  to  several  persons  they  shall  take  as 
tenants  in  common,  in  proportion  to  their  respective  rights. 

§  294.  Alienism  of  ancestor. —  A  person  capable  of  in- 
heriting under  the  provisions  of  this  article,  shall  not  be 
precluded  from  such  inheritance  by  reason  of  the  alienism 
of  an  ancestor. 


FORMS. 


FORMS. 


MEMORANDUM 

Suggested  by  the  Appraisers  of  New  York  County  in  Preparing  Affi- 
davits to  be  Used  upon  Appraisals. 

Date  of  death. 

Residence  at  time  of  death.  If  nonresident,  whether  decedent  wa9 
ever  a  resident  of  the  State  of  New  York,  and  if  so,  when. 

If  will  was  probated  without  the  State  annex  a  certified  copy  thereof, 
or  a  copy  with  proof  that  the  same  is  a  true  copy.  Also  state  when 
and  where  said  will  was  probated,  and  date  when  letters  were  issued, 
and  to  whom. 

Names  and  addresses  of  executors  or  administrators. 

Personal  property  itemized,  setting  forth  par  and  market  value  of 
each  item  at  date  of  decedent's  death,  and  how  the  value  thereof  was 
ascertained. 

State  specifically  whether  decedent  died  possessed  of  any  silverware, 
jewelry,  household  furniture,  personal  effects,  statuary,  works  of  art, 
paintings,  pictures,  books,  bric-a-brac,  horses,  carriages,  etc. 

If  assets  include  stocks  or  bonds,  describe  the  same  as  follows: 

100  shares  Erie  R.  R.  common  stock,  par  value  $100,  at  12%.    $1,275  00 
One  $1,000  bond,  Chicago  &  Northwestern  R.  R.,  extension, 

4's,  due  1926,  at  108V2    1,085  00 

If  there  are  unlisted  securities  give  capitalization,  nature  of  business, 
itemized  statement  of  assets,  values  thereof,  itemized  statement  of  lia- 
bilities, dividends  paid,  amount  of  surplus,  and  date  of  maturity,  with 
such  other  facts  as  may  be  pertinent,  affecting  their  value. 

State  whether  decedent  died  possessed  of  mortgages  or  promissory 
notes,  or  deposits  in  trust  companies,  and  if  so,  itemize  them  and  give 
the  interest  accrued  thereon  at  date  of  death. 

Deposits  in  savings  banks  should  include  interest  to  last  interest  day 
preceding  date  of  death. 

State  whether  there  are  any  claims  due  and  owing  decedent,  and  if 
so,  the  nature  thereof;  if  worth  less  than  their  face  value,  state  par- 
ticularly and  in  detail  the  reasons  for  their  depreciation. 

State  whether  decedent  had  any  life  insurance;  or  interest  in  any 
estate,  and  if  so,  state  the  amount  fully  and  in  detail. 

State  whether  any  reversion  fell  in  by  reason  of  decedent's  death. 

If  decedent  left  any  interest  in  any  copartnership  or  business,  state 
fully,  in  itemized  form,  the  assets  and  liabilities  of  the  same  as  shown 
bv  the  books  for  several  years  preceding  his  death. 
*  If  the  decedent  be  a  nonresident,  state,  in  itemized  form,  the  value 
■  I  the  personal  and  real  property  within  the  State  of  New  York,  in- 
cluding shares  of  stock  of  corporations  of  the  State  of  New  York,  and 
the  gross  value  of  the  entire  personal  estate  wherever  situated. 

[400] 


410  FORMS. 

state  whether  decedent  made  any  transfer  or  conveyance  of  real  or 
personal  property  prior  to  death  in  contemplation  of  death,  or  to  take 
effect  at  or  after  death.     If  so,  what  property  and  of  what  value. 

state  whether  decedent  was  given  power  of  disposition  of  property 
by  the  will  of  another. 

State  that  deponent  has  made  diligent  search  for  property  of  every 
kind,  nature,  and  description,  left  by  the  decedent,  and  that  he  has  been 
able  to  discover  only  that  mentioned  in  his  affidavit,  and  that  he  verily 
believes  that  decedent  left  no  property,  either  real  or  personal,  except 
that  set  forth  in  his  affidavit. 

Tf  there  are  life  estates,  give  names  and  ages  of  life  tenants  and  names 
of  remaindermen,  and  state  whether  said  remainders  are  contingent  or 
vested. 

State  whether  any  party  in  interest  be  dead ;  whether  he  died  before 
or  after  the  decedent,  and  give  names  of  his  survivors  if  they  are 
interested. 

State  whether  the  decedent  left  any  real  estate  in  the  State  of  New 
York.  Describe  it  in  detail,  with  street  and  number,  city  and  county; 
give  its  assessed  valuation,  and  furnish  an  appraisal  thereof  by  a 
competent  real  estate  expert  as  to  its  market  value. 

State  deductions  claimed,  in  detail.  If  debts  and  funeral  expenses 
are  requested  to  be  deducted,  itemize  the  same  and  state  whether  said 
debts  were  due  and  owing  at  the  date  of  death  of  the  decedent,  and  have 
been  paid  or  will  be  paid. 

State  the  names  of  the  beneficiaries,  or  next  of  kin,  their  relationship 
lo  decedent,  and  the  amount  of  each  legacy  or  distributive  share. 

State  whether  all  parties  in  interest  are  of  full  age  and  sound  mind, 
and  if  there  are  infants,  their  names  and  whether  they  are  under  or 
over  fourteen  years  of  age,  and  whether  they  have  any  guardian. 


PETITION  FOR  APPRAISAL  —  RESIDENT  DECEDENT. 

(S  230,  Tax  Law.) 
SURROGATE'S  COURT  —  County  of 


Ix  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,   Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


The  petition  of   respectfully  shows : 

First:  That  your  petitioner  is  the  (executor,  admin- 
istrator, or  other  person  interested,  including  the  State  Comptroller ) 
of ,  deceased. 

Second :     That  said  decedent  died  on  the day  of  , 

190 .  . ,  at    ,  in  the  county  of    ,  and  State  of 

New  York,  and  was  at  that  time  a  resident  of  the  county  of 

and  State  of  New  York. 


FORMS. 


411 


Third :     That  letters on  the  estate  of  said  decedent  were 

issued    to    by   the   Surrogate's    Court   of   the   county   of 

on  the day  of   ,  190. .,  and  that  said 

(executor  or  administrator)  thereafter  entered  upon  the  discharge  of 
his  duties,  and  is  still  acting  as  such  (executor  or  administrator)  ; 
that  his  post-office  address  is  

Fourth:  That,  as  your  petitioner  is  informed  and  believes,  the  trans- 
fer of  the  property  of  the  decedent  by  (will  or  intestate  laws)  or  some 
portion  thereof,  or  some  interest  therein,  is  or  may  be  subject  to  the 
payment  of  the  tax  imposed  by  the  law  in  relation  to  the  taxable  trans- 
fers of  property. 

Fifth :  That  all  the  persons  or  corporations  who  are  interested  in 
said  estate,  and  who  are  entitled  to  notice  of  all  proceedings  herein, 
together  with  their  post-office  addresses,  or  places  of  business,  are  as 
follows : 


Name. 


Interested  as. 
State  Comptroller.  . 


P.  O.  Address. 
Albany.  X.    Y. 


Sixth :  That  all  the  above-named  persons  are  of  full  age  and  of  sound 
mind,    except    

Wherefore  your  petitioner  prays  for  the  entry  of  an  order  herein 
designating  a  transfer  tax  appraiser  as  provided  by  law. 

Dated.  Albany,  N.  Y.,   ,  190. . 


(Add  verification.) 


Petitioner. 


ORDER   DESIGNATING   APPRAISER. 

(§  230,  Tax    Law.) 

At  a  Surrogate's  Court,  held  in  and  for  the  county  of 

at  the  surrogate's  office  in  the  of 

the   day  of  ,  190.  . 

Present  —  Hon ,  Surrogate. 

SURROGATE'S  COURT  —  County  of  


.,  on 


Im  the  Mattkb  of  the  Appraisal  of  the  Estate 

OF 

,   Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Propertt. 


On  reading  and  filing  the  verified  petition  of  (executor 

or   administrator)     of,   etc.,   of   said    decedent,    I    direct 


412  FORMS. 

,  Esq.,  who  is  a  person   (appointed  by  the  Comptroller  or 

designated  by  statute)  to  act  as  appraiser  in  this  proceeding,  to  fix  the 
fair  market  value  at  the  time  of  the  transfer,  of  the  property  of  the 
above-named  decedent  which  is  subject  to  the  payment  of  any  tax  im- 
posed by  article  X  of  chapter  908  of  the  Laws  of  1896,  and  the  acts 
amendatory  thereof  and  supplemental  thereto.  (Also  any  other  facts  in 
relation  thereto  which  the  surrogate  may  desire  the  appraiser  to  report 
upon,  should  be  stated  here.) 


Surrogate. 


OATH  OF  APPRAISER. 

(§  230,  Tax  Law.) 
SURROGATE'S  COURT  —  County  of  


In  the  Matteb  of  the  Appraisal  of  the  Estate 
of 

,  Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


V 


STATE   OF   NEW   YORK,  , 

1  ss. 


County  of 


! 


,  being  duly  sworn,  says :     I  am  the  person  directed  to 

appraise  the  property  of  the  above-named  decedent  by  order  of  Hon. 

,  surrogate  of  the  county  of   ,  State  of  New 

York,  by  order  dated  the    day  of    ,   190. .,  and  in 

pursuance  of  chapter  908  of  the  Laws  of  1896,  and  the  acts  amendatory 
thereof  and  supplemental  thereto,  I  will  faithfully  and  honestly  per- 
form the  duties  of  such  appraiser  according  to  the  best  of  my  under- 
standing and  ability. 


Sworn  to  before  me,  this day 

of    ,    190.. 


Notary  Public. 

(Section  229  of  the  Tax  Law  provides  that  in  the  counties  where  the 
office  of  appraiser  is  appointed  by  the  State  Comptroller  that  his  oath 
of  office  shall  be  filed  with  the  State  Comptroller. ) 


FORMS.  413 

NOTICE  OF   HEARING   BEFORE   APPRAISER. 

(§  230,  Tax  Law.) 
SURROGATE'S  COURT  —  County  of  


In  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,  Deceased, 

Under  the  Acts  in  Relation  to  the  Taxarle 
Transfers  of  Property. 


To ,  residing  at : 

You    will    please   take   notice   that   pursuant    to    an   order   of   Hon. 

,  surrogate  of  the  county  of ,  made  and  entered 

the day  of ,  190. .,  and  pursuant  to  the  provisions 

of  chapter  908  of  the  Laws  of  1896,  and  the  acts  amendatory  thereof 

and  supplemental  thereto,  I  will  on  the    day  of   , 

190 . . ,  at o'clock  in  the noon  of  that  day,  at , 

in  the  ,  proceed  to  appraise  the  property  of  the  above- 
named  decedent  at  its  fair  market  value  at  the  time  of  decedent's  death, 
the  transfer  of  which  property  or  some  part  thereof  is,  or  may  be, 
subject  to  the  tax  imposed  by  said  act,  or  the  acts  amendatory  thereof 
and  supplemental  thereto. 

And  such  of  you  as  are  under  the  age  of  twenty-one  years,  are  re- 
quired to  appear  by  guardian,  if  you  have  one,  or,  if  you  have  none, 
to  appear  and  apply  for  one  to  be  appointed,  or,  in  the  event  of  your 
neglect  or  failure  to  do  so,  a  guardian  will  be  appointed  by  the  surro- 
gate to  represent  and  act  for  you  in  this  proceeding  at  any  stage 
thereof,  as  provided  by  section  231  of  the  Transfer  Tax  Law. 


Appraiser. 
Dated,   ,  190.. 

(A  copy  of  this  notice,  together  with  an  affidavit  of  mailing  the  same 
to  all  the  persons  interested  in  said  estate,  naming  them,  should  bet 
attached  to  each  of  the  appraiser's  reports.) 


SUBPCENA. 

(§  230,  Tax  Law.) 

THE  PEOPLE  OF  THE  STATE  OF  NEW  YORK, 

To  ,  Greeting  : 

We  command  you,  that  all   business  and  excuses  being  laid  aside, 

vou  and  each  of  you  appear  and  attend  at    ,  in  the  city 

\or  village)  of ,  on  the day  of ,  190.  ., 


414 


FORMS. 


at o'clock  in  the noon  of  that  day,  before  the  undersign.ed, 

heretofore  duly  designated  the  appraiser  by  Hon ,  sur- 
rogate of  the  county  of   ,  under  the  act  in  relation  to  the 

taxable  transfers  of  property,  in  a  proceeding  now  pending  in  the  said 
Surrogate's  Court,  entitled,  "  In  the  Matter  of  the  Appraisal  of  the 

Estate  of    ,  Deceased,"  to  testify  what  you  and  each  of 

you  may  know  concerning  the  estate  or  property  of  the  said  decedent 
on  the  part  of  (the  executors  or  other  interested  party),  and  that  you 

produce  or  bring  with  you  at  the  time  and  place  aforesaid  

(to  be  filled  in  in  accordance  with  the  requirements  of  each  case). 
And  for  a  failure  to  attend  or  a  failure  to  produce  the  (books,  papers, 
etc.,  above  required)  you  will  be  deemed  guilty  of  a  contempt  of  court 
and  liable  to  pay  all  'loss  and  damages  sustained  thereby  to  the  party 
aggrieved,  and  in  addition  thereto,  forfeit  the  sum  of  fifty  dollars. 

Witness    ,  appraiser  aforesaid  at    ,  in  the 

city    ( or  village)    of    ,  this    day  of    , 

190.. 


Appraiser. 


APPLICATION  TO  SUPERINTENDENT  OF  INSURANCE. 

(§  231,  Tax  Law.) 
CHAMBERS  OF  THE  SURROGATE'S  COURT— County  of  . . . 


Estate  of 


Deceased,  „ 


Date  of  Death, 


,  190.. 

Dear  Sib.—  In  pursuance  of  chapter  908,  Laws  of  1896.  and  the  acts 
amendatory  thereof  and  supplemental  thereto,  you  are  hereby  requested 
to  determine  and  ascertain  the  values  of  the  following  estates,  an- 
nuities and  interests:  xt 

Value  or 
Name.  Age.  Legacy  or  Estate.  Amount. 


To  Superintendent  of  the  Insurance  Department. 

Respectfully, 


Surrogate. 


FORMS.  415 


REPORT  OF  APPRAISER. 

(§  230,  Tax  Law.) 
SURROGATE'S  COURT  —  County  of   


I  n  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,   Deceased, 

Uxdeb  the  Acts  in  Relation  to  the  Taxable 
Tbansfebs  of  Pbopebty. 

J 

(Decedent  died ,  190.  .,  a  legal  resident  of  the  county  of 

and  State  of  ) 


To  Hon ,  Surrogate   ,  County,  New  York: 

I,  the  undersigned  appraiser,  who  was  by  an  order  of  the  surrogate  of 

county,   duly   made   and   entered   on   the    day   of 

,  190.  .,  directed  to  appraise  the  property  of  said  decedent, 

at  its  fair  market  value  at  the  time  of  the  transfer  thereof,  in  pur- 
suance of  the  laws  in  relation  to  taxable  transfers  of  property,  do 
respectfully  report: 

First:  That  pursuant  to  chapter  908  of  the  Laws  of  1896,  as  amended, 
1  duly  took  and  subscribed  the  oath  prescribed  by  statute,  and  filed  the 
>ame  as  therein  provided. 

Second:   That   on    the    day   of    ,    190..,    I    gave 

notice  by  mail,  postage  prepaid,  to  such  persons,  corporation-,  etc., 
known  to  have,  or  claim  an  interest  in  any  property  of  sail  decedent 
subject  to  the  payment  of  any  tax  imposed  by  said  laws,  including  the 
Comptroller  of  the  State  of  Now  York,  and  those  persons  and  corpora- 
tions named  by  the  surrogate  in  his  said  order,  of  the  time  and  place 
at  which  1  would  appraise  said  property,  a  true  copy  of  which  notice 
together  with  proof  of  mailing  is  hereto  annexed. 

That  the  names  of  those  to  whom  I  mailed  such  notices,  properly  ad- 
dressed, and  postage  prepaid,  as  appears  by  proof  of  mailing  hereto  an- 
nexed, are  as  follows: 
State  Comptroller.  Albany.  X.  Y. 


Third:   At  the  time  and  place  in  said  notice  stated,  namely  on  the 

day  of   ,  190.  .    (and  at  other  and  subsequent  times 

and  divers  places  to  which  these  proceedings  were  regularly  adjourned ) , 
1  appraised  all  the  property,  real  and  personal,  of  which  the  said 
decedent  died  possessed,  and  subject  to  the  payment  of  said  transfer  tax. 
at  its  fair  market  value  at  the  time  of  said  transfer  {including  the 
property  over  which  the  decedent  exercised  a  power  of  appointment) .  as 
follows,  namely: 


416 


FORMS. 


Personal  Estate. 

(It  is  desired  that  the  appraiser  should  classify  the  property  in  the 
following  order:  1.  Bonds;  2.  Stocks;  3.  Bonds  and  mortgages  on 
real  estate,  promissory  notes,  etc. ;  4.  Cash  in  banks ;  5.  All  other 
personal  property.) 

Fair  Market  Value 
Description  of  Property.  Par  Value.       at  Time  of  Decedents 

Death. 


|. 


Total . 


Real  Estate. 
(Insert  a  brief  description  of  each   parcel  of  real  estate,  sufficient  to 
identify  the  same  by  reference  to  the  records  of  the  clerk's  office 
of  the  proper  county,  or  otherwise.) 

Fair  Market  Value 
Brief  Description.  at  Time  of  Decedents 

Death. 

$ 

Total $ 


Fourth.  I  further  report  that  decedent's  estate  is  subject  to  the  fol- 
lowing deductions  on  account  of  debts,  claims,  expenses  of  administra- 
tion and  commissions,  as  follows: 


Fifth :  Recapitulation. 

Total  amount  of  decedent's  personal  estate 

Total  amount  of  decedent's  real  estate  after  deducting  any 

incumbrances  thereon  

Total  

From  which  any  bequests  or  devises  to  those  re- 
ferred to  in  said  act  as  "  specifically  ex- 
empted "  is  to  be  deducted,  the  aggregate 
amount  of  which  is  $ 

Also  debts,  expense  of  administration,  etc., 
enumerated  in  the  "  fourth "  finding  above, 
amounting  to   

Leaving  sum  of   


FORMS. 


417 


Which  is  the  net  estate  transferred,  as  follows: 


Names   and     resi- 
dence of  the  per- 
sons, corporations 

Relation 

to 
decedent 

Nature  of 

interest 

(absolute 

or 

otherwise) 

Value  of  Property  or  In- 
terest Transferred 

Total 

or  institutions,  re- 
ceiving any  prop- 
erty 

To  \%  class 

To  5%  class 

transferred 

Real 

— 

Personal 

Real 



— 

Personal 

Real 

Personal 

Real 

Personal 

Total  estate  transferred  to 

1   per   cent 

S 

Total  estate  transferred  to  5  per  cent  class 

$ 

8 

Sixth :   I  further  report  that  all  of  said  persons  interested  in  said  es- 
tate are  of  sound  mind,  and  of  full  age,  except, 


Seventh:   I  further  report  that  the  following  appearances  were  made 
before  me  in  this  proceeding: 


Eighth:   I  further  report  as  follows: 

Name  of  decedent   Date  of  decedent's  death   

Decedent  was  a  resident  of  the  town  of ,  county 

of    ,   State   of    Decedent   left    will. 

Letters    were   issued   by  the   surrogate   of  the   eounty  of 

,  to 

whose  post-office  address  is 

That  the  six-months'  limitation  expires  on  the day  of , 

190...      That   the   eighteen-months'    limitation   expires    on   the    

day  of  ,  190.  .. 

Ninth :  I  further  report  that  attached  hereto  is  all  the  testimony 
taken  by  me,  and  the  copies  of  all  papers  presented  to  me  in  this  pro- 
ceeding, namely: 


27 


418  FORMS. 

Tenth :  I  do  further  report,  that  the  said  deceased  made  no  transfer  of 
any  property  by  deed,  grant,  bargain,  sale,  or  gift  in  contemplation  of 
death,  or  intended  to  take  effect  in  possession  or  enjoyment  at  or  after 
the  death  of  said  deceased. 


Eleventh:   I  do  further  report: 


All  of  which  is  respectfully  submitted,  in  duplicate,  at. 
this day  of   ,  190.  . 


Appraiser. 
(Attach  all  testimony,  exhibits,  and  papers  here.) 


ORDER  RETURNING  REPORT  TO  APPRAISER. 

At  a  Surrogate's  Court,  held  in  and  for  the  county  of ,  at 

the   ,  in  the  city    ( or  village )    of   ,  on 

the day  of ,190.. 

Present  —  Hon ,  Surrogate. 

SURROGATE'S  COURT  —  County  of   


In  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,   Deceased,  y 

Undeb  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


Upon  reading  and  filing  the  consents  in  writing  of ,  Esq., 

attorney  for  the  executors  (or  administrators) ,  and ,  Esq., 

attorney  for  the  State  Comptroller,  and  upon  the  affidavit  of , 

dated  the   day  of   ,  190. .,  from  which  it  appears 

It  is  Ordered:  That  the  report  of  the  appraiser  duly  filed  herein  on 

the day  of ,  190 .. ,  be  returned  to  him  for  further 

consideration,  and  report,  particularly  in  reference  to 


Surrogate. 


FORMS. 


419 


ORDER    DETERMINING    THE   TAXABLE    TRANSFERS    AND    AS- 
SESSING THE  TAX. 

(§  231,  Tax  Law.) 

At  a  Surrogate's  Court,  held  in  and  for  the  county  of >  .at 

the   ,  in  the  city   (or  village)    of   ,  on 

the day  of ,  190.. 

Present  —  Hon ,  Surrogate. 

SURROGATE'S  COURT  —  County  of  


In  the  Matter  of  the  Appbaisal  of  the  Estate 
of 

,   Deceased, 

Undee  the  Acts  in  Relation  to  the  Taxable 
Transfebs  of  Property. 


Upon  reading  the  report  of ,  appraiser,  filed  herein  on  .the 

day  of   ,  190. .,  wherein  it  appears  that  the  said 

decedent  died  on  the day  of  ,  190 . . ,  a  resident  of 

,    in    the    State    of     ;    and    on    motion    of 

,  Esq.,  attorney  for  the  herein ;    , 

Esq.,  appearing  for  the  State  Comptroller,  and  (objecting  or  consenting 
thereto),  it  is: 

Obdebed  and  Adjudged:  That  the  cash  value  of  the  property  referred 
to  in  said  report,  the  transfer  of  which  is  subject  to  the  tax  imposed 
by  the  acts  in  relation  to  the  taxable  transfers  of  property  and  the  lax 
to  which  said  transfers  are  liable,  is  as  follows: 


Beneficiary. 


Relationship, 


Cash  Value  of 
Interest. 


Tax  assessed 
Thereon, 


Surrogate. 


420 


FORMS. 


NOTICE  OF  ASSESSMENT   OF   TAX. 
(§  231,  Tax  Law.) 
SURROGATE'S  COURT  —  County  of    


In  the  Mattek  of  the  Appraisal  of  the  Estate 
of 

,   Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


To 


You  are  hereby  notified  that  I  have,  by  order  made  and  entered  the 

day  of    ,   190.  .,   assessed  and  fixed   the  cash  value 

of  such  interest,  estate,  legacy,  or  property,  as  you  are  entitled  to  re- 
ceive from  the  estate  of  the  above-named  decedent,  and  the  amount  of 
tax  to  which  the  same  is  liable  under  the  laws  in  reference  to  the  tax- 
able transfers  of  property,  as  follows: 
Estate,  Interest  or  Property  Transferred.  Cash  Value.  ^hereorf. 


Surrogate. 


NOTICE  OF  APPEAL   TO   SURROGATE. 

(§  232,  Tax  Law.) 
SUPREME  COURT  —  County  of   


In  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,   Deceased,  J* 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


Gentlemen. —  You    will    please    take    notice    that    is 

dissatisfied   with   the   appraisal    herein   of   the   property   of   the   above- 
named  decedent,  as  made  and  set  forth  in  the  report  of , 

the    appraiser    herein,    and    with    the    order   fixing    and    assessing    the 


FORMS.  421 

transfer  tax  in  respect  to  the  transfers  of  the  property  of  said  decedent, 

made  and  entered  herein  on  the    day  of    ,   190 .  . , 

and  hereby  appeals  to  the  surrogate  from  the  said  appraisal  and  from 
said  order  assessing  tax  as  aforesaid,  upon  the  following  grounds: 

First :      

Second:     (if  there  are  several  grounds  of  appeal,  each 

should  be  stated)    

Dated,  Albany,  N.  Y.,  ,  190 . . 


Attorney  for    . . 
To ,  Esq., 

Attorney  for  

To Esq., 

Clerk  of  the  Surrogate's  Court,  County  of 


(Upon  filing   this  notice  in   the  surrogate's  office  the  appeal  to  th« 
surrogate  has  been  duly  taken.) 


ORDER  OF  SURROGATE  ON  APPEAL. 

At  a  Surrogate's  Court,  held  in  and  for  the  county  of 

at  the  surrogate's  office,  in  the    of 

on  the day  of  ,  190 .  . 

Present  —  Hon ,  Surrogate. 

SURROGATE'S  COURT  —  County  of   


In  the  Matteb  of  the  Appraisal  of  the  Estate 
of 

,   Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


An  appeal  having  been  taken  by ,  the  ( executor,  legatee, 

or   other   party   appellant)    from   the    order    fixing   and   assessing   the 

transfer  tax  herein  made  and  entered  on  the day  of , 

190.  .,  upon  the  report  of ,  the  appraiser  herein,  which  re- 
port was   duly   filed   in   the  office   of  the   surrogate  of   the  county  of 

,    on    the     day    of     ,    190 .  . ,    on    the 

grounds  that ,  as  will  more  fully  appear  by  reference  to  thu 

notice  of  appeal  filed  herein  on  the day  of ,  190.  . 

And  said  appeal  coming  on  to  be  heard,  and  having  heard  , 

Esq.,  for  the   ,  appellant,  and   ,  Esq.,  for  the 

,  respondent : 

Now  on  motion  of  ,  attorney  for  the  

It    Is    Ordered:      That    said    appeal    be,    and    the    same    hereby    is 

And  It  Is  Further  Ordered  :   

Surrogate. 


422  FORMS. 

NOTICE  OF  APPEAL  TO  THE  APPELLATE  DIVISION. 

SURROGATE'S  COURT  —  County  of  


In  the  Mattes  of  the  Appraisal  of  the  Estate 
of 

,  Deceased,  y 

Undeb  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


Gentlemen. —  You  will  please  take  notice  that  hereby 

appeals  to  the  Appellate  Division  of  the  Supreme  Court  of  the  State  of 

New  York   for   the    Department,   from   the   order   of  the 

surrogate  of  the  county  of   ,  heretofore  made  and  entered 

lierein  on  the day  of  ,  190 . . ,  affirming  ( or  revers- 
ing or  modifying )  the  order  theretofore  made  and  entered  on  the 

day  of  ,  190 . . ,  fixing  and  assessing  a  tax  upon  the  trans- 
fers of  the  property  of  said  decedent  under  the  law  relating  to  taxable 
transfers  of  property,  and  from  each  and  every  part  thereof  (or  from 
so  much  thereof,  etc.,  stating  the  portion  of  the  order  appealed  from). 

Dated  the  day  of ,  190 .  . 

Yours,  etc., 


Attorney  for 
To  ,  Esq., 

Clerk  of  the  Surrogate's  Court  of  the  county  of 
To  ,  Esq., 

Attorney  for  the  State  Comptroller. 


PETITION  TO  REMIT  INTEREST. 
(§  223,  Tax  Law.) 
SURROGATE'S  COURT  —  County  of  


In  the  Matter  of  the  Appraisal  of  THii  Estate 
of 

,   Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


To  the  Surrogate's  Court  of  the  County  of : 

The  petition  of  respectfully  shows : 

That  your  petitioner  is  the  of  the  above-named  de- 
cedent, who  died  a  resident  of  the  county  of    ,  State  of 

,  on  the day  of   ,  190 .  . 


FORMS. 


423 


That    proceedings    have    been    had    before     ,    appraiser 

herein  for  the  determination  of  the  tax  upon  the  transfer  of  the  prop- 
erty of  said  decedent,  which  tax  has  been  fixed  and  assessed,  by  order 

entered  herein  on  the   day  of   ,  190.  .,  at  the  sum 

of  3 ,  as  by  reference  to  the  report  of  the  appraiser  duly 

filed  in  the  surrogate's  office  of  said  county,  and  the  order  aforesaid, 
will  more  fully  appear. 

That  the  transfer  tax  assessed  herein  has  not  been  paid,  although 
more  than  eighteen  months  have  elapsed  since  the  accrual  thereof,  and 
by  reason  of  such  nonpayment,  interest  thereon  at  the  rate  of  ten 
per  centum  per  annum  has  been  incurred  as  provided  by  statute. 

That  by  reason  of    (here  state  the  facts,  showing  the 

statutory  reasons  entitling  the  persons  liable  to  pay  the  tax  to  have 
the  interest  thereon  remitted  to  six  per  cent.)  your  petitioner  believes 
that  the  interest  upon  said  tax  should  be  remitted  from  ten  per  cent. 
to  six  per  cent,  as  provided  by  statute. 

That  your  petitioner  is  desirous  of  paying  the  tax  as  fixed  by  said 
order  herein,  as  soon  as  his  claim  for  the  remission  of  interest,  based 
upon  the  foregoing  reasons,  can  be  passed  upon  by  the  court. 

Wherefore  your  petitioner  prays  that  an  order  be  made  and  entered 
herein  remitting  the  interest  upon  the  tax  assessed  to  six  per  cent., 
to  be  charged  upon  said  tax  from  the  accrual  thereof  until  the  cause 
of  such  delav  was  removed,  after  which  ten  per  cent,  is  to  be  charged 
as  provided  by  statute,  provided  such  payment  be  made  within  ten  days 
from  the  entry  of  the  order  remitting  such  interest  as  aforesaid,  and 
that  your  petitioner  may  have  such  other  and  further  relief  as  to  the 
court  may  seem  just. 

Dated,   ,  190.. 

Petitioner. 

(Add  verification.) 


NOTICE  OF  MOTION  ON  APPLICATION  TO  REMIT  INTEREST. 

(  §  223,  Tax  Law. ) 
SURROGATE'S  COURT  —  County  of   


In  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,  Deceased, 

Under  the  Acts  in  Relation  to  the  Taxahle 
Transfers  of  Property. 


Please  take  notice  that  on  all  the  papers  and  proceedings  herein,  and 

the  verified  petition  of  ,  hereto  annexed  and  bearing  date 

the  day  of      ,   190..,  application  will  be  made  to 

the  surrogate  of  the  county  of  at  a  Surrogate's  Court  to 

be  held  at   on  the   day  of   ,  190.  .,  at 

o'clock  in  the    noon  of  that  day,  for  an  order  remitting 


424  FORMS. 

the  interest  upon  the  tax  heretofore  assessed  upon  the  estate  of  the 
above-named  decedent,  by  order  of  said   surrogate  made  and  entered 

the   day  of   ,  190.  .,  from  ten  per  cent,  to  six  per 

cent,  per  annum,  to  be  computed  from  the  accrual  of  said  tax  until  the 
circumstances  preventing  the  earlier  payment  of  said  tax  were  removed, 
and  for  such  other  and  further  relief  as  to  the  court  may  seem  just. 
Dated  the    day  of    ,   190.. 


To  Hon , 

State  Comptroller,  Albany,  N.  Y. 


Attorney  for  Petitioner. 


ORDER  REMITTING  INTEREST  FROM  TEN  TO  SIX  PER  CENT. 

(§  223,  Tax  Law.) 


At  a  Surrogate's  Court,  held  in  and  for  the  county  of 

at  the  surrogate's  office,  in  the    of 

on  the   day  of   ,   190 . . 

Present  —  Hon ,  Surrogate. 

SURROGATE'S  COURT—  County  of   


In  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,   Deceased, 

Undeb  the  Acts  in  Relation  to  the  Taxable 
Tbansfees  of  Propebtt. 


On  reading  and  filing  the  verified  petition  of   ,  wherein 

it  appears  that  payment  of  the  transfer  tax  upon  the  estate  of  the 
above-named  decedent,  as  determined,  has  been  unavoidably  delayed, 
by  reason  of   

And   due  notice   of  this   application   and   motion   having  been   given 

to   ,  Esq.,  attorney  for  the  State  Comptroller    (or  to  the 

State  Comptroller  personally)  : 

Now,  on  motion  of    ,   Esq.,   attorney  for  the   petitioner 

herein,    appearing    ( in   opposition   thereto   or  consenting 

thereto),  it  is 

Ordered:  That  interest  at  the  rate  of  ten  per  cent,  upon  the  tax 
heretofore  assessed  herein,  be  remitted  to  six  per  cent  per  annum,  to 

be  computed  from  the  accrual  thereof  until  the day  of , 

190 . . ,  after  which  date  interest  at  the  rate  of  ten  per  cent,  is  to  be 
charged,  until  said  tax  is  paid,  as  provided  by  the  statute. 

> 

Surrogate. 


FORMS.  425 

(It  is  the  practice,  where  application  is  made  for  the  remission  of 
interest  as  soon  as  the  conditions  preventing  an  earlier  payment  are 
removed,  for  the  order  to  remit  the  penalty  from  ten  per  cent,  to  six 
per  cent.,  provided  payment  is  made  within  ten  days  after  the  entry  of 
such  order,  and  without  reference  to  computing  the  interest  at  the  rate 
of  ten  per  cent,  from  and  after  the  dissaUlity  was  removed  until  the 
same  is  paid.) 

PETITION  FOR  APPRAISAL  AND   DETERMINATION  BY  SURRO- 
GATE. 

(§  230,  Tax  Law.) 

SURROGATE'S  COURT  —  County  of   


In  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,   Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


To  the  Surrogate's  Court  of  the  County  of   : 

The  petition  of    respectfully  shows: 

( 1 )  That  your  petitioner  is  the  of,  etc.,  of  the  above- 
named  decedent,  who  died  on  the    day  of    ,   190.  ., 

a  resident  of  the  county  of   and  State  of   

( 2 )  That  letters   were  duly  issued  to  petitioner  on  the 

day  of    ,   190. .,  and  that  your  petitioner   is  still 

acting  as  such   

(3)  That  the  decedent's  estate  consists  of  cash  amounting  to 
$ (or  articles  of  personal  property  which  have  been  con- 
verted into  cash  by  the  executor  or  administrator,  in  his  administra- 
tion upon  the  estate,  and  other  items  of  personal  property,  the  clear 
market  value  of  which  at  the  time  of  decedent's  death  is  fully  stated 
in  Schedule  A,  hereto  annexed.) 

(4)  That  Schedule  B,  hereto  annexed,  contains  an  itemized  list  of 
the  debts  of  decedent,  including  funeral  and  testamentary  expenses,  com- 
missions, etc. 

(5)  That  Schedule  C,  hereto  annexed,  contains  the  names  of  all  the 
legatees  or  other  beneficiaries  under  the  decedent's  will  (or  the  persons 
entitled  as  distributees  in  case  of  intestacy). 

(6)  That  all  the  persons  above  named  are  of  full  age  and  sound 
mind  except   

Wherefore  your  petitioner  prays  that  said  surrogate  will  appraise 
the  value  of  the  decedent's  estate  forthwith,  and  fix  the  amount  of  the 
transfer  tax  assessable  thereon. 

Dated,    ,   190.. 

Petitioner. 

Add  verification:  And  where  decedent  left  a  toill,  a  copy  should  be 
attached  referring  thereto  under  paragraph   (5). 

[Notice  of  this  application  should  be  given  the  State  Comptroller.) 


426 


FORMS. 


ORDER   ASSESSING  TAX  WHERE  NO   APPRAISAL   HAS   BEEN 
DIRECTED. 


(§  231,  Tax  Law.) 

At  a  Surrogate's  Court,  held  in  and  for  the  county  of   , 

at  the    of    ,   on   the    day   of 

,  190.. 

Present  —  Hon ,  Surrogate. 

SURROGATE'S  COURT  —  County  of  


In  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,   Deceased, 

LTnder  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


Upon  reading  and  filing  the  verified  petition  of ,  wherein 

it  appears  that  the  decedent  above  named  died  on  the    day  of 

,   190..,  and  due  notice  of  motion   having  been  given  to 

,  Esq.,  attorney  for  the  State  Comptroller   (or  to  the  State 

Comptroller  personally)  : 

Now,  on  motion  of ,  Esq.,  attorney  for  the  petitioner 

herein,  it  is 

Ordered:  That  the  cash  value  of  the  property  referred  to  in  the 
petition  herein,  the  transfer  of  which  is  subject  to  the  tax  imposed 
by  the  law  relating  to  taxable  transfers  of  property  and  the  tax  to 
which  each  of  said  transfers  are  liable,  respectively,  is  as  follows: 


Legatee  or  Distributee. 


Relationship. 


Cash  Value 
of  Interest. 


Amount 
of  Tax. 


Surrogate. 


FORMS.  427 

PETITION  SHOWING  ESTATE  TO  BE  EXEMPT. 

(§  230,  Tax  Law.) 

The  same  form  of  petition  can  be  used  in  an  application  for  an  order 
declaring  an  estate  to  be  exempt  from  taxation  as  that  used  in  an 
application  for  appraisal  and  determination  of  tax  by  the  surrogate 
without  referring  the  appraisal  of  the  estate  to  the  official  appraiser 
or  county  treasurer.     (See  Form  on  page  425.) 

(Xotice  of  such  application  should  be  given  the  State  Comptroller.) 


ORDER  EXEMPTING  ESTATE. 

(§  231,  Tax  Law.) 

At  a  Surrogate's  Court,  held  in  and  for  the  county  of 

at  the   surrogate's  office,   in  the    of 

on  the day  of ,  190 . . 

Present  —  Hon ,  Surrogate. 

SURROGATE'S  COURT  —  County  of   


In  the  Matteb  of  the  Appraisal  of  the  Estate 

OF 

,   Deceased,   ► 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


Upon  reading  and  filing  the  verified  petition  of ,  wherein 

it  appears  that  the  decedent  above  named  died  on  the   day  of 

,    190 .  . ,   a   resident   of  the   county   of    and 

State  of   ,  and  that  the  transfer  of  the  property  of  said 

decedent  is  not  subject  to  tax  under  the  law  relating  to  taxable  trans- 
fers of  property,  and  that  due  notice  of  this  application  was  given  to 

,  Esq.,  attorney  for  the  State  Comptroller  (or  to  the  State 

Comptroller  personally) . 

Now,  on  motion  of    ,  Esq.,  attorney  for  the  petitioner 

herein,  it  is 

Ordered:  That  the  transfer  of  property  of  which  said  decedent  died 
siezed  and  possessed  and  mentioned  in  said  petition  is  exempt  from 
tax  under  the  law  relating  to  taxable  transfers  of  property. 

Surrogate. 


428  FORMS. 

DISTRICT  ATTORNEY  PROCEEDINGS  —  PETITION. 

(§  235,  Tax  Law.) 

SURROGATE'S  COURT  —  County  of   



In  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,   Deceased,  y 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


To  the  Surrogate's  Court  of  the  County  of : 

The   petition  of    respectfully   shows: 

First:     That  your  petitioner  is  the  district  attorney  of  the  county  of 

,  in  the  State  of  New  York,  and  your  petitioner  further 

alleges  upon  in  formation  and  belief: 

Second:    That  on  or  about  the   day  of  ,  190. .,  the 

above-named  decedent  died  a  resident  of  the  county  of    

State  of  

Third:  That  thereafter  proceedings  were  duly  instituted  in  the  Sur- 
rogate's Court  of  the  county  of   to  have  the  amount  of  tax 

upon  the  transfers  of  the  property  of  said  decedent  fixed  and  deter- 
mined, as  provided  by  the  law  relating  to  the  taxable  transfers  of  the 
property  of  decedents,  and  that  an  order  was  entered  by  the  surrogate 

of  the  county  of   in  such  proceedings  on  the  day 

of ,  190.  .,  fixing  and  assessing  the  transfer  tax  therein  at 

the  sum  of   dollars. 

Fourth:  Your  petitioner  further  shows  that  eighteen  months  have 
elapsed  since  the  accrual  of  said  tax,  and  that  the  State  Comptroller 
has  notified  your  petitioner  in  writing  of  the  refusal  or  neglect  of  the 
persons  liable  therefor  to  pay  the  said  tax  and  the  interest  due  thereon, 
and  that  no  part  thereof  has  been  paid  (except,  etc.,  where  some  legatee 
has  paid  the  tax  on  his  individual  transfer)  and  your  petitioner  be- 
lieves that  the  same  still  remains  due  and  unpaid. 

Wherefore  your  petitioner  prays  that  a  citation  issue  under  the 
seal  of  this  court  directed  to  ,  the  executor  (or  adminis- 
trator)  of  said  estate,  and  to    ,  the  persons 

or  corporations  liable  to  taxation  upon  the  transfers  of  the  property 
of  said  decedent  to  them  respectively,  as  appears  by  the  taxing  order, 
entered  herein,  as  aforesaid,  citing  them,  and  each  of  them,  to  appear 
before  this  court  on  a  certain  day  to  be  designated  therein  and  show 
cause,  if  any  they  have,  why  the  tax  and  interest  under  the  law  relating 
to  the  taxable  transfers  of  property  should  not  be  paid. 

Dated  the day  of 190. . 


District  Attorney  of  the  County  of 
(Add  verification.) 


FORMS. 

ORDER    GRANTING   CITATION. 

(  §  235,  Tax  Law. ) 

At  a   Surrogate's  Court,  held  in  and  for  the  county  of 

at  the  surrogate's  office,   in  the    of 

on  the   day  of   ,  190 .  . 

Present  —  Hon ,  Surrogate. 

SURROGATE'S   COURT  —  County  of    


429 


In  tjie  Matter  of  the  Appraisal  of  the  Estate 

OF 

,    Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


On   reading  and  filing  the  verified  petition  of ,  district 

attorney  in  and  for  the  county  of ,  bearing  date  the 

dav  of ,  190.  it  is 

Ordered:  That  a  citation  issue  herein  in  accordance  with  the  prayer 
of  said  petitioner. 

> 

Surrogate. 


CITATION   TO   SHOW   CAUSE. 
(§  2355,  Tax  Law.) 
The  People  of  the  State  of  New  York  : 


By  the  grace  of  God,  free  and  independent,  to 

(executors  or  administrators  of,  etc.),  and  to 


greeting : 

You.  and  each   of  you.   are  hereby  cited   and   required   personally  to 

be  and  appear  before  the  surrogate  of  the  county  of   .at 

the  Surrogate's  Court  in   and   for  said   county,  held  at    on 

the day  of   ,  190.  . ,  at   o'clock  in  the 

noon  of  that  day,  then  and  there  to  show  came  why  the  transfer  tax 
upon  the  transfer  of  the  properly  of  the  above-named  decedent,  and  upon 
vour,  and  each  of  vour,  shares  or  interests  respectively,  pursuant  to 
chapter  908  of  the  Laws  of  1890  and  the  acts  amendatory  thereof  and 
supplementary   thereto,   should   not  be  paid,   which   tax   has  been   duly 

fixed  ;m<l  assessed  by  order  of  the  surrogate  of  the  county  of 

made  and  entered  the day  of ,  190. .,  together  with 

the  interest  thereon,  which  is  now  due  and  unpaid. 


430  FORMS. 

And  such  of  you  hereby  cited  as  are  under  the  age  oi  twenty-one 
years  are  required  to  appear  by  your  guardian,  ii  you  have  one,  or,  if 
you  have  none,  to  appear  and  apply  for  one  to  be  appointed;  or  in  the 
event  of  your  neglect  or  failure  to  do  so,  a  guardian  will  be  appointed 
by  the  surrogate  to  represent  and  act  for  you  in  this  proceeding. 

In  Testimony  Whereof  we  have  caused  the  seal  of  the  Surrogate's 

Court  of  the  county  of to  be  hereunto  affixed. 

Witness,  Hon ,  surrogate  of  the  county  of   

[L.  S.]      ,  at    the    day  of    , 

190.. 


Clerk  of  the  Surrogate's  Court. 


DECREE   DIRECTING   PAYMENT. 

At  a  Surrogate's  Court,  held  in  and  for  the  county  of 

at  the  surrogate's  office  in  the    of 

on  the day  of  ,  190 . . 

Present  —  Hon ,  Surrogate. 

SURROGATE'S  COURT  —  County  of 


In  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,   Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


Upon  the  petition  of  the  district  attorney,  heretofore  filed  herein  on 
the  day  of  ,  190..,  and  the  report  of  the  ap- 
praiser,  and  the  order  entered  thereon   on  the    day  of    

,   1905,   fixing  and  assessing  the  tax  upon  the  transfers  of  the 

property  of  the  above-named  decedent,  and  after  hearing  , 

Esq.,  on  behalf  of  Hon ,  district  attorney,  in  support  of 

said  petition  and  upon  all  the  papers  and  proceedings  herein,  and   (no 

one   appearing   in  opposition    thereto    or)     ,   attorney    for 

herein,  having  appeared  in  opposition  thereto,  it  is 

Ordered:    That ,  the  {executor  or  administrator)  herein 

make  payment  forthwith  to  the  State  Comptroller  of  the  sum  of 
dollars,  being  the   amount  of  tax  upon  the  interests  of 


together  with  interest  upon  each  of  said  sums  respectively,  at  the  rate 

of  ten   per  cent,   per  annum,  from  the    day  of    , 

190. .,  to  the  date  of  payment  (or) 

Ordered  :  That  (reciting  a  direction  similar  to  the  foregoing  that  each 
legatee  or  distributee  shall  pay  forthwith  the  tax  and  interest  assessed 
upon  the  transfer  to  him  individually) . 


FORMS.  431 

And  It  Is  Fubtheb  Ordered:  That  said  (executor  or  administrator) 
pay  to  Hon ,  district  attorney,  the  sum  of dol- 
lars, as  and  for  his  costs  and  disbursements  herein;    (or) 

And  It  Is  Further  Ordered:  That  Hon ,  district  attor- 
ney, is  allowed  the  sum  of dollars,  as  and  for  his  costs  and 

disbursements  herein,  to  be  paid  forthwith  by  the  above  legatees  or 
distributees  in  proportion  to  the  amount  of  tax  due  and  owing  by  each 
respectively,  and  in  addition  to  said  tax  and  interest. 


Surrogate. 

{The  form  of  decree  directing  payment  in  district  attorney  proceed- 
ings is  new  since  the  amendment  of  section  235  by  chapter  368  of  the 
Laws  of  1905,  now  providing  that  these  proceedings  cannot  be  com- 
menced UNTIL  AFTER  THE  EXPIRATION  OF  EIGHTEEN  MONTHS 
from  the  accrual  of  the  tax,  etc.  If  the  determination  of  the  surrogate 
should  be  that  the  proceedings  should  be  dismissed  the  foregoing  form 
can  be  easily  modified  accordingly.) 


AFFIDAVIT   FOR  APPRAISAL   OF   THE   PROPERTY   OF  NON- 
RESIDENT   DECEDENTS. 

(§  230,  Tax  Law.) 

SURROGATE'S  COURT  —  County  of  


In  the  Matter  of  the  Appraisal  of  the  Estate 
of 

Deceased,  V 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


..I 


STATE  OF   

County  of  .. . 

,  being  duly  sworn  says : 

First :  That  he  resides  at •,  and  that  the  above-named  dece- 
dent  died   on   the    day   of    ,    190..,   a   resident  of 

in  the  State  of   ,  and  that  thereafter  letters 

testamentary  (or  letters  of  administration)   were  issued  to  deponent  by 

the     Court    of    the    county    of    ,    State    of 

,  on  the   day  of   ,  1905,  and  deponent 

thereupon  entered  upon  the  discharge  of  his  duties  as  such  (executor 
or  administrator),  and  that  he  is  still  acting  as  such  (executor  or 
administrator) . 

Second:  That  Schedule  A,  hereto  annexed,  and  made  a  part  hereof, 
contains  an  itemized  statement  of  all  the  property,  real  and  personal, 
of  which  the  said  decedent  died  seized  or  possessed,  situated  within 
the  State  of  New  York,  including  the  shares  of  stock  of  all  New  York- 
corporations,  debts  owing  to  decedent  by  debtors  residing  in  the  Stat* 
of  New  York,  certificates  of  deposit,  choses  in  action,  or  other  property. 


432  FORMS. 

Third :  That  Schedule  B,  hereto  annexed  and  made  a  part  hereof, 
contains  an  itemized  statement  of  all  the  personal  property  owned  by 
said   decedent,  situated  without   the   State  of  New  York. 

Fourth :  Said  decedent,  at  the  time  of  his  death,  had  no  safe-de- 
posit box,  individually  or  held  jointly  in  the  name  of  the  decedent  and 
one  or  more  persons  within  the  State  of  New  York,  in  which  was  de- 
posited bonds,  public  or  private,  mortgages,  money,  or  any  evidences 
of  debt  whatsoever ;  that  he  was  not  carrying  on  any  business  or  inter- 
ested in  any  copartnership  within  the  State  of  New  York ;  that  he 
owned  no  shares  of  stock  of  national  banks  situated  therein,  and  did 
not  own  any  jewelry,  horses,  carriages,  furniture,  or  other  items  of 
personal  property  of  any  nature  or  kind  whatsoever  in  said  State, 
exeept  as  fully  set  forth  in  said  Schedule  A,  hereto  annexed.  (//  the 
decedent  exercised  a  power  of  appointment  over  any  property  within  this 
State,  the  facts  should  be  fully  stated  here.) 

Fifth :  That  prior  to  his  death  the  said  decedent  made  no  transfer  of 
property  within  the  State  of  New  York  by  deed,  grant,  bargain,  sale,  or 
gift  made  in  contemplation  of  death  or  intended  to  take  effect  in  pos- 
session or  enjoyment  at  or  after  death.  {State  whether  any  person  or 
persons  became  entitled  to  any  remainder  or  reversion  in  property 
within  this  State  by  reason  of  the  decedent's  death.) 

Sixth:  That  the  fair  market  value  of  the  decedent's  entire  per- 
sonal estate,  wheresoever  situated,  at  the  time  of  his  death,  was 
dollars. 

Seventh :  That  Schedule  C,  hereto  annexed,  and  made  a  part  hereof, 
contains  an  itemized  statement  of  the  funeral  expenses  and  expenses  of 
administration  incurred  and  to  be  incurred  by  the  representatives  of 
said  estate:  Also  an  itemized  statement  showing  the  valid  debts  due 
and  owing  by  decedent  at  the  time  of  his  death,  and  the  commissions 
to  which  I  am  entitled  as  {executor  or  administrator)  by  the  laws  of 
the  State  of    

Eighth:  That  all  the  persons  interested  in  said  estate  are  of  full 
age   and    sound   mind,   except    

Ninth:  {When  decedent  left  a  will.)  That  Schedule  D,  annexed 
hereto,  and  made  a  part  hereof,  contains  a  full  and  true  copy  of  the 
decedent's  last  will  and  testament. 

(When  decedent  died  intestate.)  That  all  the  persons  who  are  en- 
titled to  share  in  the  estate  of  said  decedent,  together  with  their  rela- 
tionship, places  of  residence,  and  the  share  or  interest  of  each  are  as 
follows: 

Name  of  Distributee.  Relationship.        Place  of  Residence.         interest 


Executor  or  Administrator. 

Sworn  to  before  me,  this   day 

of  ,  190.. 


Notary  Public. 
(County  clerk's  certificate  should  be  attached.) 


FORMS.  433 

PETITION  FOR  APPRAISAL  —  NONRESIDENT  DECEDENT. 

(§  230,  Tax  Law.) 
SURROGATE'S  COURT—  County  of  


In  the  Matteb  of  the  Appbaisal  of  the  Estate 
or 

,   Deceased, 

Undeb  the  Acts  in  Relation  to  the  Taxable 
Tbansfers  of  Propebty. 


To  the  Surrogate's  Court  of  the  County  of 


The   petition   of    respectfully   shows : 

First:  That  he  is  (the  executor,  administrator,  or  other  interested 
person,  including  the  State  Comptroller),  and  as  such  is  interested  in 
the  estate  of  the  above-named  decedent. 

Second:  That,  as  petitioner  is  informed  and  believes,  the  above- 
named    decedent   died   on    or   about   the    day   of    , 

190. .,  a  resident  of  ,  in  the  county  of   ,  and 

State  of   ,  and  at  the  time  of  his  death  he  was  seized  and 

possessed  of  property  in  the  county  of    ,  in  the  State  of 

New  York,  all  or  some  part  of  which  is  subject  to  taxation  under  the 
laws  relating  to  the  taxable  transfers  of  property,  to  the  value  of  and 
upwards  of  (ten  thousand  dollars,  or  where  it  passes  to  collaterals, 
in  whole  or  in  part,  five  hundred  dollars). 

Third:  That  your  petitioner  is  informed  and  believes  that  said 
decedent    (died  intestate,  or)   left  a  last  will  and  testament  which  wan 

thereafter  and  on  or  about  the day  of ,  190.  .,  duly 

admitted    to    probate    by    the     Court    of    the    county    oi 

,  State  of    ,  by  the  terms  of  which  said  de 

cedent  appointed    of    the   executor   of   his 

said  will,  and  the  said   is  still  acting  as  such  executor. 

Fourth:  That,  as  deponent  is  informed  and  believes,  no  application 
has  been  made  for  ancillary  letters  upon  the  estate  of  said  decedent  in 

the  county  of or  any  other  county  in  this  State,  and  that  no 

proceeding  has  been  brought  by  the  representatives  of  said  decedent  to 
fix  and  determine  the  tax  upon  the  transfers  of  the  property  of 
said  decedent  within  this  State  at  the  time  of  his  death,  although 
application  has  been,  or  is  about  to  be,  made  by  such  representatives 
to  remove  such  property  from  the  State  of  New  York  without  first 
having  the  transfer  tax  thereon  determined  and  paid. 

Fifth:  That  (where  decedent  left  a  mil)  attached  hereto  is  a  copy 
of  the  decedent's  will;  (where  the  decedent  died  intestate)  attached 
hereto  is  an  affidavit  of  the  foregoing  administrator  of  said  decedent 
showing 

Sixth:    That  all  the  persons  who  are  interested  in  said  estate,  and 

28 


43-i  FORMS. 

who  are  entitled  to  notice  of  all  proceedings  herein  and  their  addresses, 

are  as  follows: 

Comptroller. .  . .      Albany,  N.  Y. 


Seventh:  (Where  application  is  made  on  behalf  of  the  State  Comp- 
troller.) That  attached  hereto,  and  made  a  part  hereof,  is  the  affidavit 
of  the  executor  (or  administrator) ,  showing  in  detail  the  facts  herein- 
before stated. 

Wherefore  your  petitioner  prays  for  the  entry  of  an  order  herein, 
directing  the  appraisal  of  the  property  of  the  above-named  decedent,  as 
provided  by  law. 

Dated   (Albany,  N.  Y.),  ,  190. . 


Petitioner. 


(Add  verification.) 


ORDER  DESIGNATING  APPRAISER  —  NONRESIDENT   DECEDENT. 

(§  230,  Tax  Law.) 

(The  order  designating  appraiser  in  case  of  resident  decedents  can 
be  used  in  designating  an  appraiser  of  the  property  of  nonresident 
decedents,  with  slight  change  where  reference  is  made  to  the  petition 
upon  which  the  order  is  granted.     See  Form  on  page  411.) 


AFFIDAVIT 

Required  by  the  State  Comptroller  upon  Application  for  the  Removal 
or  Transfer  of  the  Property  of  a  Nonresident  Decedent,  where 
Transfer  Tax  Proceedings  have  not  been  Instituted. 

(§  227,  Tax  Law.) 


Application  to  the  Comptroller  of  the 

State  of  New  York 

For  Consent  to  Transfer  Certain  Property 

Belonging  to 


Late  a  Resident  of 


Application  is  made  to  the  Comptroller  of  the  State  of  New  York 
for  consent  to  transfer  the  following  property  belonging  to  the  above- 


FORMS.  435 

named  nonresident  decedent,  pursuant  to  section  227  of  the  Transfer 
Tax  Law  of  the  State  of  New  York,  namely : 

Present  value. 

100  shares  Erie  common  stock,  par  value,  $100,  at $ 

Deposit  in  the  Albany  Savings  Bank 

Total    '•  •■     $ 


(All  the  property  within  this  State  should  be  set  forth,  including 
stocks  of  Neic  York  corporations,  etc.,  as  required  by  the  following 
affidavit,  to  be  attached  to  such  application:) 

STATE    OF   NEW    YORK,  )    g  . 
County  of    ,      j 

,   being   duly   sworn,    says:     (the  affidavit   should  show 

the  following  facts)  : 

Name  of  decedent  —  date  of  death,  and  decedent's  late  residence. 

Name  and  address  of  the  executor  or  administrator,  and  whether 
ancillary  letters  have  been  applied  for  in  this  State  or  not. 

Shares  of  stock  of  various  New  York  corporations  owned  by  the 
decedent. 

Bonds,  foreign  and  domestic,  physically  present  within  this  State 
at  the  time  of  decedent's  death. 

Bank  stock,  and  cash  on  deposit  in  any  sayings  bank  or  other  institu- 
tion in  this  State.  Also  certificates  of  deposit  issued  by  any  bank, 
trust  company,  or  other  institution  in  this  State. 

Policies  of  insurance  upon  the  life  of  such  nonresident  issued  by 
corporations  of  this  State  and  payable  to  the  decedent  or  his  legal 
representatives. 

Notes  or  other  evidences  of  indebtedness  owing  such  nonresident  by 
residents  of  this   State. 

Whether  the  decedent  was  interested  in  any  partnership,  or  carried 
on  any  business  within  this  State,  and  if  so,  the  nature  and  location 
thereof.  Also  whether  the  decedent  was  entitled  to  any  legacy  or  share 
of  an  estate,  the  nature,  amount,  and  particulars  in  reference  thereto. 

If  the  nonresident  decedent  exercised  a  power  of  appointment  over 
any  property  within  this  State,  that  fact  shall  be  fully  set  forth,  also 
whether  any  remainder  or  reversionary  interest  passed  under  any  prior 
will,  or  any  transfer  to  any  one  in  possession  or  enjoyment,  as  the 
result  of  the  decedent's  death. 

Real  property  in  this  State  owned  by  decedent,  giving  a  brief  descrip- 
tion of  each  parcel,  and  the  estimated  value  thereof,  after  deducting 
any  incumbrances  thereon. 

Any  property,  real  or  personal,  or  any  interest  therein,  other  than 
the  above  within  the  State  of  New  York,  and  the  values  thereof. 

Whether  the  decedent  made  any  transfer  of  property  within  this 
State  in  contemplation  of  death  or  intended  to  take  effect  in  possession 
or  enjoyment  at  or  after  his  death. 

The  names,  residence,  and  relationship  of  all  persons  receiving  any 
portion  of  the  decedent's  property  and  the  amount,  or  other  interest 
therein,  whether  such  persons  are  residents  of  this  State  or  not;  also 
the  character  of  any  corporation  of  the  State  of  New  York,  or  any 
other  State,  to  and  for  the  nse  of  which  any  pari  of  the  stock  of  New 
York  corporations  —  the  proceeds  from  the  sale  thereof  or  any  other 


436  FORMS. 

property  within  this  State,  will  be  transferred  by  reason  of  the  will  of 
said  decedent. 


Sworn  to  before  me,  this    

day  of  ,  190.. 

» 

Notary  Public  (or  other  officer  before  whom 
affidavit  is  made ) . 

(Although  not  required  at  present,  it  is  best  to  attach  a  county  clerk't; 
certificate  to  this  affidavit. 

When  the  person  making  the  affidavit  is  in  doubt  as  to  whether  a 
certain  corporation  in  which  the  decedent  owned  shares  of  stock  is  a 
New  York  corporation  or  not,  such  fact  should  be  set  forth,  giving  the 
name  of  the  corporation,  the  number  of  shares  —  par  value  —  and  the 
market  value  thereof  at  the  time  of  decedent's  death. 

If,  from  the  foregoing  affidavit,  it  appears  that  the  estate  of  the 
decedent  is  exempt  from  taxation  under  the  laics  of  this  State,  consent 
will  be  given  at  once  for  the  transfer  of  the  particular  property  set 
forth.  If  it  appears  from  the  affidavit  that  the  estate  or  some  part 
thereof  is  taxable,  the  State  Comptroller  will  cause  proceedings  to  be 
instituted  in  the  proper  county,  to  have  the  tax  fixed  and  assessed  by 
the  surrogate,  and  this  proceeding  is  WITHOUT  EXPENSE  to  the 
nonresident  estate,  the  representatives  being  only  required  to  furnish 
the  necessary  affidavits  in  order  to  properly  present  the  facts  to  the 
surrogate. ) 


AGREEMENT  —  UPON    COMPOSITION   OF  TRANSFER  TAX. 

(§  233,  Tax  Law.) 
SURROGATE'S  COURT  — County  of    


In  the  Matter  of  the  Appraisal  of  the  Estate 
of 

,   Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


Whereas,  The  above-named    died  on  the    day 

of   ,  190 .. ,  a  resident  of  the  county  of   and 

State  of   ,   leaving  a  last  will   and  testament  which  was 

duly  admitted  to  probate  in  the  Surrogate's  Court  of  the  county  of 

,    and    letters    testamentary    were    thereupon    issued    to 

,  of   ,  New  York. 

And  Whereas,    Transfer  tax  proceedings  were  thereafter  regularly 

instituted  in  the  Surrogate's  Court  of  the  county  of   ,  and 

by  order  of  Hon ,  surrogate  of  said  county  of , 

made  and  entered  the day  of ,  190 .  . ,  , 

Esq.,  was  directed  to  appraise  the  property  of  said  decedent  pursuant 
to  the  provision  of  the  law  relating  to  the  taxable  transfers  of  property, 


FOBMS.  437 

and  the  report  of  such  appraiser  was  filed  in  the  office  of  the  surro- 
gate aforesaid,  and  an  order  entered  thereupon  on  the   day  of 

,  190 . . ,  fixing  and  assessing  a  transfer  tax  upon  certain 

transfers  of  said  decedent's  property  at  the  sum  of  $ 

And  Whebeas,   Decedent  by  the  clause  of  his  will  provided 

as  follows :    

And  Whereas,  It  appears  from  the  report  of  said  appraiser  that 
in  view  of  the  foregoing  provision  (or  provisions)  of  said  decedent's 
will  it  was  impossible  to  presently  determine  the  value  of  the  estate 

or  property  transferred  to   at  the  time  of  the  decedent's 

death,  and  that  the  appraisal  thereof  was  therefore  postponed  until 
the  value  of  said  transfers  could  be  definitely  determined  (or  such 
other  facts  by  reason  of  which  the  present  taxability  of  the  transfer 
has  been  heretofore  held  for  future  appraisal,  it  appearing  that  the 
remainders  or  expectant  estates  were  of  such  a  nature,  or  so  disposed 
and  circumstanced,  that  the  taxes  thereon  were  held  not  present  payable, 
or  where  the  interests  of  the  legatees  or  devisees  were  not  ascertainable 
as  provided  in  section  233  of  the  Tax  Law. 

And  Whebeas,  The  said  (executor  or  trustees)  above  named  are 
now  desirous  of  personally  settling  the  remaining  claims  of  the  people 
of  the  State  of  New  York  upon  or  in  respect  to  the  transfers  of  the 
property  or  estates,  and  the  tax  thereon  which  may  now  be  due  and 
payable,  or  which  may  hereafter  become  payable,  under  the  laws  of 
the  State  of  New  York,  and  by  compounding  all  such  taxes  upon  terms 
which  are  equitable  and  expedient,  and  that  said  executor  or  trustees 
be  granted  a  discharge  upon  the  payment  of  the  taxes  provided  for 
in  this  composition  agreement  in  pursuance  of  the  law  in  such  case 
made  and  provided. 

Now,  Thebefobe,  In  consideration  of  the  foregoing: 

It  is  Hebeby  Stipulated  and  Agbeed:     That  the  transfer  tax  in 

respect  to    be,  and  the  same  hereby  is  ascertained, 

fixed,  compounded,  and   adjusted  at  the  sum  of    dollars 

($ ),  which  sum  it  is  agreed  shall  be  accepted  by  the  Hon. 

,  as  Comptroller  of  the  State  of  New  York,  by  and  with  the 

npproval  of  the  Hon ,  Attorney-General  of  the   State  of 

New  York,  in  full  payment,  satisfaction,  and  discharge  of  all  transfer 
taxes  which  are  payable,  or  which,  but  for  this  agreement,  might  at 
any  time  hereafter  become  due  and  payable  to  the  State  of  New  York, 
under  or  by  virtue  of  the  laws  thereof,  upon  or  in  respect  to  the 
transfers  of  the  property  or  estate  of  the  above-named  decedent  which 
are  mentioned  and  referred  to  as  compromised,  and  which  have  become 
fully  settled  and  adjusted  by  the  execution  of  this  composition  agree- 
ment, as  provided  by  section  233  of  the  Transfer  Tax  Law. 

In  Witness  Whereof,  the  said  (executor  or  trustees), 

under  the  will  of  the  said   ,  deceased,  and  Hon , 

Comptroller  of  the  State  of  New  York,  have  signed  and  acknowledged 

the    execution   of   these   presents   in    triplicate,    this    day   of 

,   190.. 

[E.  s.) 

IX.   8.] 

[L.  S.) 

Approved,  this   day  «f   ,  190 .  . 


Attorney-General. 

(Add  acknowledgments  by  the  representatives  of  the  estate,  and  State 
Comptroller. ) 


438  FORMS. 


CERTIFICATE 

Of  Comptroller  Showing  Payment  of  Tax  upon  Real  Estate  Belonging 

to  Decedent. 


(§  236,  Tax  Law.) 


STATE   OF   NEW   YORK 
Comptroller's  Office 


! 


In  the  Matter  of  the  Appraisal  of  the  Estate 

OF 

,   Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


Albany,  N.  Y.,  ,  190. . 

I,    ,   Comptroller  of  the  State  of  New  York,  do  hereby 

certify  that  it  appears   from   the  records  of  this  office  that  upon  the 

report  of   ,  appraiser  in  and  for  the  county  of   , 

in  the  State  of  New  York,  a  duplicate  copy  of  which  report  was  filed 

in  this  office  on  the   day  of   ,  190.  .,  an  order  was 

made  by  Hon ,  surrogate  of   county,  on  the 

day  of   ,   190 .  .,  assessing  a  transfer  tax  upon  the 

transfers  of  the  property  of  said   ,  who  died  a  resident  of 

on    the    day   of    ,    190 ..  ;    that   the 

amount  of  said  tax  assessed,  as  aforesaid,  was  the  sum  of  $ , 

a  part  of  which  sum  is  the  tax  assessed  upon  the  transfer  of  cer- 
tain real  estate,  or  which  the  above-named  decedent  died  seized  and 
which  is  described  and  appraised  in  the  report  of  said  appraiser  as 
follows,    namely :     


And  1  further  certify  that  the  amount  of  said  tax   (less  the  discount 
for  payment  within  six  months  from  the  accrual  thereof;  or,  together 

with  interest  thereon  at  the  rate  of   per  cent,  per  annum  from 

the  accrual  thereof,  where  not  paid  within  eighteen  months)   has  been 

fully  paid   by    (the   executor  or  administrator)    of  said 

estate,  and  that  the  final  duplicate  receipts  showing  such  payment  were 

issued  under  date  of   ,  190.  .,  and  that  by  reason  thereof 

tha  lien  of  the  State  of  New  York  upon  the  real  estate  hereinbefore 
described,  for  tax  (and  interest)  due  upon  the  transfer  thereof,  has 
been  fully  satisfied  and  discharged. 

In  Witness  Whereof,  I  have  hereunto  set  my  hand  and  affixed 

[l.  s.]     my  official  seal,  this day  of ,  190 .  . 


Comptroller. 

(If  the  tax  upon  the  real  estate  was  paid  by  the  devisee  or  heir-at- 
hur  the  foregoing  certificate  will  be  modified  accordingly.  It  would, 
.'.c<  ui  that  the  heir  or  devisee  is  not  entitled  to  this  certificate  until  the 
tax  has  been  assessed,  although  payment  on  account  thereof  may  have 
been   made.) 


FORMS. 


439 


APPLICATION   TO   JUSTICE   OF   SUPREME   COURT   FOR   RE- 
APPRAISAL. 

(§  232,  Tax  Law.) 

SUPREME  COURT  —  County  of  


In  the  Matter  of  the  Application 
of 

Hon 

State  Comptroller,  for  a  Reappraisal  of 
the  Property 

of 

,  Deceased, 

Under  the  Acts  in  Relation  to  the  Taxable 
Transfers  of  Property. 


To  Hon ,  one  of  the  Justices  of  the  Supreme  Court  of  the 

Judicial  District : 

The  petition  of  Hon respectfully  shows : 

(1)  That  your  petitioner  is  the  Comptroller  of  the  State  of  New- 
York,  and  that  the  above-named  decedent  was  a  resident  of 

in  the  county  of   ,  and  State  of  New  York  at  the  time  of 

his  death,  which  said  place  is  within  the   judicial  district 

of  the  Supreme  Court  of  this  State. 

(2)  That  the  said  decedent  died  on  the day  of   , 

190..,  and  letters   (testamentary  or  of  administration)   were  issued  by 

the  surrogate  of  the  county  of   to   > 

who  were  and  are  the  duly  qualified  and  acting   (executors  or  adminis- 
trators)  of  the  estate  of  said  decedent. 

(3)  That  proceedings  have  heretofore  been  instituted  to  determine  the 
clear  market  value  of  the  decedent's  estate  at  the  time  of  the  transfer 
thereof  and  the  liability  of  the  transfers  of  said  decedent's  property  to 
taxation  under  chapter  908  of  the  Laws  of  189(5  and  the  acts  amendatory 

thereof  and  supplemental  thereto,  and  upon  the  report  of  

Esq.,  the  appraiser  in  such  proceedings,  an  order  was  entered  by  the  sur- 
rogate of  the  county  of  on  the day  of , 

190..     (determining   the  value  of  decedent's  estate   to   be   the  sum    o\ 

$ ,  and  exempting  said  estate  or  fixing  and  assessing  the 

tax  upon  the  transfers  of  said  decedent's  property,  as  follows:) 

| 4 )  That  your  petitioner  is  informed  and  believes  that  such  ap- 
praisal (assessment  or  determination)  was  (fraudulently,  collusively, 
or  erroneously  made)    owing  to  the  following  errors   of   fact,   namely, 


(5)  That  two  years  have  not  elapsed  since  the  entry  of  the  order  or 
decree  of  the  surrogate  determining  the  value  of  said  ostate  and  assess- 
ing the  tax  thereon  (or  exempting  said  estate  from  taxation). 


440  FORMS. 

(6)  That  all  the  persons  (or  corporations)  who  are  interested  in 
said  estate  and  who  are  entitled  to  notice  of  all  proceedings  herein, 
together  with  their  post-office  addresses  or  places  of  business,  are  as 
follows : 

Name.  Interested  as.  P.  O.  Address. 


And  that  all  of  said  persons  are  of  full  age  and  sound  mind  except 


Wherefore  your  petitioner  prays  for  the  appointment  of  some  com- 
petent person  to  reappraise  the  estate  of  the  above-named  decedent,  in 
accordance  with  the  provisions  of  section  232  of  the  Tax  Law. 

Dated,  Albany,  N.  Y.,   ,  190. . 

(Add   verification.)  Petitioner. 

(The  appointment  of  a  competent  person  to  act  as  appraiser,  and  the 
subsequent  proceedings  of  said  appraiser  are  in  all  respects  similar  to 
the  proceedings  before  the  surrogate  in  respect  to  the  duties  of  such 
appraiser,  and  the  foregoing  forms  may  be  followed  with  but  slight 
changes.  The  determination  and  assessment  of  such  justice  shall  super- 
sede the  previous  determination  and  assessment  of  the  surrogate,  and 
shall  be  filed  by  such  justice  in  the  State  Comptroller's  office,  and  a 
oertified  copy  thereof  transmitted  to  the  Surrogate's  Court  of  th<*> 
proper  county.) 

AFFIDAVIT   TO   BE   FILED   UPON  APPLICATION   FOR   LETTERS 
TESTAMENTARY  OR  LETTERS  OF  ADMINISTRATION. 

(§  238,  Tax  Law.) 

SURROGATE'S  COURT  —  County  of    


In  the  Matter  of  the  Application  for  Let- 
ters (Testamentary  or  of  Administration) 
Upon  the  Estate 

of 

DECEA8ED. 


STATE   OF    NEW    YORK.. )  s$  . 

County  of ,     ) 

,  being  duly  sworn,   says:      That  he  ia  the  petitioner 

herein ;    that  the   above-named   decedent  died   at  the .  .  .    of 

,  in  the  county  of  ,  and  State  of  New  York. 

on  the day  of   ,  190 .  . 


FORMS.  441 

That  the  estimated  value  of  the  real  property  in  this  State  of  which 
said  decedent  died  seized  (less  any  mortgage  incumbrance  thereon)  is 
dollars   ($ ). 

That  the  estimated  value  of  the  personal  property  of  which  said 
decedent  died  is  possessed  is   dollars   ($ ) . 

That  the  following  i3  a  complete  list  of  the  names,  residence,  and  re- 
lationship to  decedent  of  all  persons  entitled  to  any  legacy  or  share 
of  the  decedent's  estate  (and  the  names  and  place  of  business  of  all 
corporations  who  ere  entitled  to  any  legacy  or  devise  under  the  -will 
of  said  decedent),  together  with  the  character  and  value  of  such 
legacy,  devise  (or  share)  as  far  as  the  same  can  at  present  be  de- 
termined : 

Name.  P.  O.  Address.  Relationship.  Value. 


Petitioner,  and  executor  named  in  decedent's 
will  (or  petitioner,  and  person  entitled  to  ad- 
minister  upon    decedent's    estate.) 


Sworn  to  before  me,  this  dav 

of   ,  190.. 


Notary  Public. 


NOTICE  BY  BANK  OR  TRUST  COMPANY  OF  THE  TRANSFER  OF 

DEPOSITS. 


(§  227,  Tax  Law.) 


190. 


Hon State  Comptroller,  Albany,  N.  Y. : 

Dear  Sir. —  The (bank  or  trust  company)   pursuant  to 

section  227   of  chapter   368  of  the   Laws  of   1905,   hereby  gives  notice 

that  on  the day  of ,  190.  .,  or  earlier,  upon  receipt 

of  your  written  consent,  it  will  deliver  or  transfer  the  funds  now  on 

deposit   to   the   credit    of    ,    who    was    a    resident    of    the 

county  of   ,  State  of   ,  to   ,  who 

is  the  duly  qualified  and  acting  executor  (or  administrator)  of  the 
estate  of  said  decedent. 

The  post-office   address   of  the  said  executor    (or  administrator)    is 


Yours.,  etc., 

t 

Secretary  or  Treasurer,  Etc. 


442  FORMS. 


NOTICE    OF    THE    INTENDED    TRANSFER    OF    STOCK    OF   NEW 
YORK    CORPORATIONS. 

(§  227.  Tax  Law.) 

,  190.. 

Hon ,  State  Comptroller,  Albany,  N.  Y. : 

Dear  Sib. —  In  compliance  with  section  227   of  chapter  368  of  the 

Laws  of  1905,  you  are  hereby  notified  that  on  ,  190. .,  or 

earlier,  upon  receipt  of  your  written  consent,  I  will  transfer   

shares  of  the  capital  stock  of   , 

registered  in  the  name  of   ,  now  deceased,  and  whose  late 

residence  was  at   ,  in  the  State  of   

The   executor    (or   administrator)    of   the   above-named   decedent    is 
,   whose    post-office    address    is    ,    State    of 


If  there  is  no  objection  to  the  proposed  transfer  kindly  forward  the 
usual  consent. 

Yours,  etc., 


Secretary  or  other  officer. 


NOTICE  OF  INTENDED  DELIVERY  OF  CONTENTS  OF   SAFE-DE- 
POSIT   BOX    TO    EXECUTORS,    ETC. 

(§  227,  Tax  Law.) 

,    190.. 

Hon ,  State  Comptroller,  Albany,  N.  Y. : 

Dear  Sir. —  This  will  notify  you  that   ,  late  a  resident 

of  the  county  of  ,  in  the  State  of  ,  was   ( the 

indivifatal  or  joint)  lessee  of  a  safety-deposit  box  in  the  vaults  of 
(bank  or  other  institution),  and  that  application  has  been  made  by  the 
{executors  or  administrators  or  the  surviving  lessee)  for  the  delivery 
of  the  contents  of  said  box,  belonging  to  the  above  named  decedent,  to 
such  (executor,  administrator,  or  other  person  aforesaid),  and  that 
pursuant  to  section  227  of  chapter  368  of  the  Laws  of  1905  the  (bank 
or  other  institution)   aforesaid  hereby  notifies  you  that  it  will  on  the 

day  of ,  190 .  . ,  at o'clock  in  the noon 

of  that  day  deliver  the  contents  of  said  safety-deposit  box  to  the  said 
( executor,  administrator,  etc. ) . 

(In  case  of  resident  decedents.)  Your  consent  for  such  delivery,  with- 
out retaining  a  sufficient  portion  or  amount  thereof  to  pay  any  tax  and 
interest  which  may  be  thereafter  assessed  upon  the  transfer  of  such 
property,  is  requested. 

Yours,  etc., 


FORMS.  443 


NOTICE  BY  BANK  OR  TRUST  COMPANY  OF  THE  TRANSFER  OF 
DEPOSITS  IN  THE  JOINT  NAMES  OF  A  DECEDENT  AND  ONE 
OR  MORE  PERSONS,  OR  IN  TRUST  FOR  ANOTHER. 

(§  227,  Tax  Law.) 

,  190.. 

Hon ,  State  Comptroller,  Albany,  N.  Y. : 

Dear  Sir. —  The ( bank  or  trust  company) ,  of , 

hereby  gives  notice  that  there  is  standing  upon  the  books  of  this  ( bank 

or  trust  company)  a  deposit  amounting  to  $ in  the  name 

(or  in  the  joint  names)  of  ("  John  Doe  or  Richard  Roe  "  —  "  John  Doe 
(and)  (or)  Richard  Roe,  either  or  the  survivor  can  draw"  —  ''John 
Doe,  in  trust  for  Richard  Roe"  —  or  otherwise)  and  the  officers  of  said 

(bank  or  trust  company)  are  informed  and  believe  that   , 

one    of    the    persons    above    named,    has    recently    died,    a    resident    of 

,  in  the  county  of and  State  of 

and  that  on  the day  of  ,  190.  . ,  at   o'clock, 

a.  M.,  the  said  (bank  or  trust  company)  will,  at  the  request  of  (the 
executor,  administrator,  cestui  que  trust,  survivor,  or  other  interested 
person)  transfer  or  deliver  the  funds  representing  said  deposit  to  the 
said  (name  the  person  making  application  therefor).  Your  consent  to 
this  transfer  is  desired  pursuant  to  section  227  of  chapter  368  of  the 
Laws  of  1905. 

Yours,  etc., 


TABLE    OF    CASES    CITED. 


TABLE  OF  CASES  CITED. 


Matter  of:  PAGE- 

Abbett,  29  Misc.  Rep.  567,  61  N.  Y.  S.  1067 140 

Aetna  Ins.  Co.  v.  Mayor,  etc,  153  N.  Y.  331 190 

Albrecht,  136  N.  Y.  91 54 

Althause,  63  App.  Div.  252,  71  N.  Y.  S.  445,  affd.,  168  N.  Y. 

670 48 

Amherst  College  v.  Ritch,  151  N.  Y.  282 330 

Anthony,  40  Misc.  Rep.  497,  82  N.  Y.  S.  789 82 

Arnett,*49  Hun  599,  2  N.  Y.  S.  428 250,  338 

Astor,  17  N.  Y.  St.  R.  787 256 

Astor,  6  Dem.  413,  2  N.  Y.  S.  630 249,  261 

Augsbury  v.  Shurtleff,  180  N.  Y.  138 50 

Ayres  v.  Lawrence,  59  N.  Y.  192 144 

Babcock,  86  App.  Div.  563,  83  N.  Y.  S.  1020 345 

Babcock,  115  KY.  450 307,308,309 

Babcock,  37  Misc.  Rep.  445,  75  N.  Y.  S.  926,  affd,  81  App.  Div. 

645,  81  N.  Y.  S.  1117 188.   192-  291 

Baker,  83  App.  Div.  530,  82  N.  Y.  S.  390,  affd,   178  N.  Y. 

575 65<     U 

Baldwin  v.  Rico,  100  App.  Div.  241 232 

Balleis,  144  N.  Y.  132 181>  182 

Baltzer  v.  North  Carolina,  161  U.  S.  240 213 

Bartlett,  4  Misc.  Rep.  380,  25  N.  Y.  S.  990 40,     48 

Bartow,  30  Misc.  Rep.  27,  62  N.  Y.  S.  1000 Ill,  115 

Baucus  v.  Stover,  24  Hun  109 32° 

Baudouine,  5  App.  Div.  622,  39  N.  Y.  S.  1121 324 

Beach,  154  N.  Y.  242 174 

Becker,  26  Misc.  Rep.  633,  57  N.  Y.  S.  574 322 

Beckwith    (not  reported) 2j)1 

Beers  v.  Arkansas,  20  How.  (U.  S.)   527 213 

Bender,  44  Misc.  Rep.  79,  89  N.  Y.  S.  731 178 

Bentley,  31  Misc.  Rep.  656,  66  N.  Y.  S.  95 151,  342 

Berry,  23  Misc.  Rep.  231,  51  N.  Y.  S.  1132 321 

Birdsell,  22  Misc.  Rep.   180,  49  N.  Y.  S.  450,  affd,  43  App. 

Div.  624,  60  N.  Y.  S.  1133 28,  73,  175 

[447] 


448  TABLE    OF    CASES    CITED. 

Matter  of:  page. 

Bishop,  82  App.  Div.  112,  81  N.  Y.  S.  474 149,  159,  230,  253 

Black,  5  N.  Y.  S.  452 311,  312 

Black,  1  Con.  477,  5  N.  Y.  S.  452 40 

Blackstone,  69  App.  Div.  127,  74  N.  Y.  S.  508,  affd.,  171 

N.  Y.  682 137,  144,  148,  338 

Blackstone  v.  Miller,  188  U.  S.  189. .. .    120,  137,  144,  145,  322,  338 

Bliss,  6  App.  Div.  192,  39  N.  Y.  S.  875 13,     14 

Bogert,  25  Misc.  Rep.  466,  55  N.  Y.  S.  751 331,  344 

Bolin,  136  N.  Y.  177 53 

Bollweber,  N.  Y.  Law  Journal,  May  31,  1905 315 

Bolton.  35  Misc.  Rep.  688,  72  N.  Y.  S.  430 250,  261 

Borup,  2S  Misc.  Rep.  474,  59  N.  Y.  S.  1097 80 

Bostwick,  160  N.  Y.  489 * 78 

Bowditch  v.  Ayrault,  138  N.  Y.  222 278 

Brandreth,  28  Miec.  Rep.  468,  59  N.  Y.  S.  1092 267 

Brandreth,  169  N.  Y.  437 79,  81,     85 

Brenner,  170  N.  Y.  185 190 

Brez,  172  N.  Y.  609 4,  99,  187,  287,  297 

Bronson,  150  N.  Y.  1 125,  137,  154,  155,  265 

Bruce,  59  N.  Y.  S.  1083 35S 

Brundage,  31  App.  Div.  34S,  52  N.  Y.  S.  362.  .v,  170,  253,  308,  347 

Brundage  v.  Village  of  Port  Chester,  102  N.  Y.  494 213 

Buckingham,  105  App.  Div.  — ,  94  N.  Y.  S.  130 100 

Bullard,  76  App.  Div.  207,  78  N.  Y.  S.  491 76 

Burr,  16  Misc.  Rep.  89,  38  N.  Y.  S.  811 150,  191,  322 

Burr  v.  Palmer,  53  App.  Div.  358,  65  N.  Y.  S.  1056 324 

Bushnsll,  73  App.  Div.  325,  77  N.  Y.  S.  4,  affd.,  172  N.  Y.  649.  .  155 
Butler,  58  Hun  400,  12  N.  Y.  S.  201,  affd.,  136  N.  Y.  649. .  170,  172 
Byrnes  v.  Stillwell,  103  N.  Y.  453 278 

Cager,  111  N.  Y.  343 13,  27,  170,  279,  300,  391 

Caiman,  100  App.  Div.  517 31S 

Cameron,  97  App.  Div.  436,  89  N.  Y.  S.  977,  affd.,  181  N.  Y. 

Mem.  49   214,  331,  347,  360 

Capron,  30  N.  Y.  St.  R.  948,  10  N.  Y.  S.  23 177 

Carlton  v.  Carlton,  72  Me.  115 144 

Carver,  4  Misc.  Rep.  592 45 

Catlin  v.  Trustees  of  Trinity  College,  113  N.  Y.  133 183 

Chamberlain  v.  Chamberlain,  43  N.  Y.  424 68 

Cheesebrough,  34  Misc.  Rep.  365,  69  N.  Y.  S.  848 61,     63 

Chicago,  Rock  Island  &  P.  R.  R.  v.  Stearns,  174  U.  S.  710 137 


TABLE    OF    CASES    CITED.  449 

Matter  of:  PAGE- 

Church  of  St.  Monica  v.  Mayor,  etc.,  119  N.  Y.  91 182 

Clark,  40  Hun  233   68 

Clark,  5  N.  Y.  S.  199 30° 

Clark,  N.  Y.  Law  Jorunal,  Dec.  26,  1904 322 

Clark,  22  N.  Y.  St.  R.  354,  5  N.  Y.  S.  199 301 

Clarke,  39  Misc.  Rep.  73,  78  N.  Y.  S.  869 293 

Clark  v.  Sheldon,  106  N.  Y.  104 8 

Clinch,  44  Misc.  Rep.  190,  89  N.  Y.  S.  802,  99  App.  Div.  298, 

90  N.  Y.  S.  923,  180  N.  Y.  300 38,  42,  67,  134,  298 

Cobb,  14  Misc.  Rep.  409,  36  N.  Y.  S.  448 29 

Collins,  104  App.  Div.  184 333,  345 

Conklin,  39  Misc.  Rep.  771,  80  N.  Y.  S.  1124 15 

Connelly,  38  Misc.  Rep.  466,  77  N.  Y.  S.  1032 344,  354 

Connoly,  38  Misc.  Rep.  533,  77  N.  Y.  S.  1113 282,  285,  313 

Coogan,  27  Misc.  Rep.  563,  59  N.  Y.  S.  Ill,  affd.,  45  App.  Div. 

628,  61  N.  Y.  S.  1144.   162  N.  Y.  613 211,  354 

Cooksey,  182  N.  Y.  92 , 90,  101,  104,  106 

Corbett,  171  N.  Y.  516 14,  169,  178,  179 

Cornell,  66  App.  Div.  162,  73  N.  Y.  S.  32  (modified,  170  N.  Y. 

423)    339,348 

Cornell,  170  N.  Y.  423 79,81,     85 

Corning,  3  Misc.  Rep.  160,  23  N.  Y.  S.  285 39 

Crai«,  97   App.   Div.  289,  89  N.  Y.   S.  971,  affd.,   181  N.  Y. 

Mem.  49 57,  82,  298,  299 

Crary,  31  Misc.  Rep.  72,  64  N.  Y.  S.  566 76,  263 

Crerar,  31  Misc.  Rep.  481,  65  N.  Y.  S.  573,  56  App.  Div.  479, 

<i7  N.  Y.  S.  795 201,  233,  262,  359 

Crosby,  40  N.  Y.  St.  R.  442,  20  N.  Y.  S.  62 73 

Cruger,  54  App.  Div.  405,  66  N.  Y.  S.  636,  affd.,  166  N.  Y.  602.  .      80 

Cullom,  145  N.  Y.  593 43 

Curtis,  31  Misc.  Rep.  83,  64  N.  Y.  S.  574 45,  141,  322 

Curtis,  142  N.  Y.  219 279,  300 

Cushing,  40  Misc.  Rep.  505,  82  N.  Y.  S.  795 155 

Daly,  34  Misc.  Rep.  148,  69  N.  Y.  S.  494 356 

Daly,   100   App.   Div.   373,  91   N.  Y.   S.   858,  affd.,   182   N.  Y. 

no  op 38.  47,  48,  142,  145,  151,  191,  322 

Daniell,  40  Misc.  Rep.  329,  81  N.  Y.  S.  1033 62 

Darlington  v.  Mayor,  etc.,  2  Robt.  277,  affd.,  31  N.  Y.  164.  10 

Davenport,  172  N.  Y.  454 29 

Davis,  149  N.  Y.  539 17,  55,  187,  195,  254,  267,  341 

Davis,  98  App.  Div.  546,  90  N.  Y.  S.  244 172,  175,  176 

20 


450  TABLE    OF    CASES    CITED. 

Matter  of:  page. 

DeGraaf,  24  Misc.  Rep.  147,  53  N.  Y.  S.  591 56,  194,  321 

Delano,  176  N.  Y.  486 4,  94,  96,  113,  114 

Demers,  41  Misc.  Rep.  470,  84  N.  Y.  S.  1109 66 

Dennison,  N.  Y.  Law  Journal,  Aug.  17,  1903 175,   176 

Dimon,  82  App.  Div.  107,  81  N.  Y.  S.  428 215,  310,  312,  314 

Dingman,  66  App.  Div.  228,  72  N.  Y.  S.  694 ... .   39,  109,  339,  340 

Doane,  N.  Y.  Law  Journal,  March  12,  1903 313 

Doty,  7  Misc.  Rep.  193,  27  N.  Y.  S.  653 44 

Dows,  167  N.  Y.  227 93,  109,  113,  114,  115,  116 

Dun,  40  Misc.  Rep.  509,  82  N.  Y.  S.  802 37,     41 

Earle,  74  App.  Div.  458,  77  N.  Y.  S.  503 260,  262,  331,  358 

Ebbets,  43  Misc.  Rep.  575,  89  N.  Y.  S.  544 29 

Edgerton,  35  App.  Div.  125,  54  N.  Y.  S.  700,  affd.,  158  N.  Y. 

671 58,  66,  76,  86,  311,  312 

Edson,   38   App.    Div.    19,   56   N.  Y.   S.   409,  affd.,   159   N.   Y. 

568 46,     60 

Edwards,  85  Hun  436,  32  N.  Y.  S.  901,  affd.,  146  N.  Y.  380.  .  .  81 
Embury,  19  App.  Div.  214,  45  N.  Y.  S.  881,  affd.,  154  N.  Y. 

746   v,  123,  234 

Enston,  113  N.  Y.  174 16,  121,  231,  246,  255 

Farley,  15  N.  Y.  St.  R.  727 59,  206 

Fay,  25  Misc.  Rep.  468,  55  N.  Y.  S.  749 62 

Fayerweather,  143  N.  Y.  114 iv,  16,  195,  197,  246 

Field,  36  Misc.  Rep.  279,  73  N.  Y.  S.  512 254 

Fisch,  34  Misc.  Rep.  146,  69  N.  Y.  S.  493 170,  171 

Fisher,  96  App.  Div.  133,  89  N.  Y.  S.  102 16,  169,  392 

Fiske,  N.  Y.  Law  Journal,  Feb.  18,  1903 283 

Fitch,  26  Misc.  Rep.  353,  57  N.  Y.  S.  212,  39  App.  Div.  609, 

57  N.  Y.  S.  786,  160  N.  Y.  87 124,  163,  189,  232,  233 

Flagg  v.  Bradford,  181  Mass.  315 212 

Foreign  Held  Bonds  Case,  15  Wall.  300 126 

Fowler  v.  Butterly,  78  N.  Y.  68 53 

Fuller,  62  App.  Div.  428,  71  N.  Y.  S.  40 4,  239 

Fulton,  30  Misc.  Rep.  70,  62  N.  Y.  S.  995 3-53,  357 

Frazer  v.  People,  6  Dem.  174,  3  N.  Y.  S 373,  377 

Garland,  88  App.  Div.  380,  84  N.  Y.  S.  630 15,  179 

Genet  v.  Hunt,  113  N.  Y.  158 116 

Gibbes,  84  App.  Div.  510,  83  N.  Y.  S.  553,  affd.,  176  N.  Y. 
565    130,  154 


TABLE    OF    CASES    CITED.  451 


Matter  of: 


PAGE. 


Gibson,  33  App.  Div.  628,  53  N.  Y.  S.  1104,  affd.,  157  N.  Y. 

680   66 

Gihon,  169  N.  Y.  443 25,  187,  305,  306,  322,  323 

Glendinning,  68  App.  Div.  125,  74  N.  Y.  S.  190,  affd.,  171  N.  Y. 

684  45,  139,  140 

Goelet,  78  N.  Y.  S.  47 55 

Gould    19   App.  Div.  352,   46   N.  Y.   S.  506    (modified  other 

points,  156  N.  Y.  423) 42,  253,  263,  307 

Gould,  156  N.  Y.  423 3,  23,  44,  59,  115,  320 

Graves,  171  N.  Y.  40,  reversing  66  App.  Div.  267,  72  N.  Y.  S. 

815  63,  182,  183 

Green,  153  N.  Y.  223 26,  31,  39,  77,  80,  85,  150,  187,  349 

Griswold  v.  Griswold  4  Bradf.  216 309 

Hackett,  14  Misc.  Rep.  282,  35  N.  Y.  S.  1051 189,  204,  375 

Hadley,  43  Misc.  Rep.  579,  89  N.  Y.  S.  545 29 

Hall,  27  N.  Y.  St.  R.  133,  7  N.  Y.  S.  595 209 

Hall,  36  Misc.  Rep.  618,  73  N.  Y.  S.  1124 278 

Hall,  88  Hun  68,  34  N.  Y.  S.  616 15 

Hallenbeck  v.  Hallenbeck,  103  App.  Div.  109 51 

Hallock,  42  Misc.  Rep.  473,  87  N.  Y.  S.  255 15,  391 

Hamilton,  N.  Y.  Law  Journal,  May  27,  1903 218 

Hamilton,  41  Misc.  Rep.  268,  84  N.  Y.  S.  44 210,  356 

Hamilton,  148  N.  Y.  310 l™ 

Hamilton  v.  Rathbone,  175  U.  S.  414 144 

Hanford,  101  App.  Div.  612,  92  N.  Y.  S.  1127 172,  176 

Harbeck,  161  N.  Y.  211 16,91,  118,  246 

Hartmann,  N.  Y.  Law  Journal,  Feb.  8,  1904 205 

Hathaway,  27  Misc.  Rep.  474,  59  N.  Y.  S.  166 233 

Havemeyer,  32  Misc.  Rep.  416,  66  N.  Y.  S.  722 60,  155 

Heller,  N.  Y.  Law  Journal,  July  16,  1904 197 

Hellman,  174  N.  Y.  254 45,  139,  140,  145,  392 

Henderson,  157  N.  Y.  423 332 

Hendricks,  18  N.  Y.  St.  R.  989,  3  N.  Y.  S.  281 256,  299 

Hewitt,  181  N.  Y.  Mem.  45,  affg.  98  App.  Div.  624,  90  N.  Y.  S. 

1100 47,  147 

Hitchins,  43  Misc.  Rep.  485,  89  N.  Y.  S.  472,  101  App.  Div.  612, 

affd.,  181  N.  Y.  Mem.  51,  no  op 24,  87,  298,  299 

Hoffman,  76  Hun  399,  27  N.  Y.  S.  1086 345 

Hoffman,  42  Misc.  Rep.  90,  85  N.  Y.  S.  1082 308,  324 

Hoffman,  143  N.  Y.  327 iv,  2,  13,  16,  26,  169,  279,  300,  391 


452  TABLE   OF    CASES   CITED. 

Matter  of:  PA<>E- 

Hoople,  179  N.  Y.  308 18,  211,  215,  354 

Hopkins,  102  App.  Div.  458 171 

Horn,  39  Misc.  Rep.  133,  78  N.  Y.  S.  979 149,  152 

Hosaek,  39  Misc.  Rep.  130,  78  N.  Y.  S.  983 282,  285 

Hosack,  N.  Y.  Law  Journal,  Nov.  22,  1897 282 

Houdayer,  150  N.  Y.  37 131,  137,  144 

Howard,  54  Hun  305,  7  N.  Y.  S.  594 209 

Howard,  5  Dem.  483 45 

Howe,   86  App.  Div.  286,   83  N.  Y.  S.  825,  affd.,   176  N.  Y. 

570 96,  115,  188,  293 

Howe,  112  N.  Y.  100 iii,  19,  391 

Howell,  34  Misc.  Rep.  40,  69  N.  Y.  S.  505 180,  287 

Hoyt,  37  Misc.  Rep.  720,  76  N.  Y.  S.  504 191,  203,  206,  298 

Hoyt,  44  Misc.  Rep.  76,  89  N.  Y.  S.  744 191,  298 

Hubbard,  21  Misc.  Rep.  566,  48  N.  Y.  S.  869 189,  233 

Huber,  86  App.  Div.  458,  83  N.  Y.  S.  769 42,  67,  297 

Hughes  v.  Golden,  44  Misc.  Rep.  128,  89  N.  Y.  S.  765 207 

Hulse,  39  N.  Y.  St.  R.  402 59 

Hunt,  86  Hun  232 173 

Huntington,  168  N.  Y.  399 180 

Hurcomb.  36  Misc.  Rep.  755,  74  N.  Y.  S.  475 46,  61,  154,  156 

Hutchinson,  N.  Y.  Law  Journal,  Jan.  13,  1905,  affd.,  105  App. 

Div.  —  (June  23,  1905) 295,  297,  314 

Hyde  v.  Woods,  94  U.  S.  524 141 

Irish,  28  Misc.  Rep.  647,  60  N.  Y.  S.  30 322 

Irwin,  36  Misc.  Rep.  277,  73  N.  Y.  S.  415 255 

Isham  v.  New  York  Assoc,  for  the  Poor,  78  App.  Div.  396,  79 
N.  Y.  S.  1048,  affd.,  177  N.  Y.  218 89,  111,  339 

Jackson  v.  Tailer,  41  Misc.  Rep.  36,  83  N.  Y.  S.  567 192 

James,  144  N.  Y.  6 155,  156 

James,  5  Dem.  30 204,  246 

Johnson,  37  Misc.  Rep.  542,  75  N.  Y.  S.  1046 359 

Johnson,  47  N.  Y.  St.  R.  391,  19  N.  Y.  S.  963 81 

Jones,  5   Dem.  30 204 

Jones,  28  Misc.  Rep.  356,  59  N.  Y.  S.  983 276 

Jones,  69  App.  Div.,  reversed  in  part,  172  N.  Y.  575 41 

Jones,  172  N.  Y.  575 37,  43,  154,  266 

Kearney,  N.  Y.  Law  Journal,  May  4,  1905 29 

Keenan,  22  N.  Y.  St.  R.  79,  5  N.  Y.  S.  200 248 


TABLE   OF    CASES   CITED.  453 

Matter  of:  page. 

Kelly,  29  Misc.  Rep.  169,  60  N.  Y.  S.  1005 182,  260,  343 

Kelly  v.  Home  Savings  Bank,  103  App.  Div.  141 52 

Kene,  8  Misc.  Rep.  102,  29  N.  Y.  S.  1078 39 

Kennedy,  20  Misc.  Rep.  531,  46  N.  Y.  S.  906 306,  322 

Kennedy,    93   App.    Div.   27    (Miller    v.    Tracy,   86    N.    Y.    S. 

1024)    269,  346 

Keough,  42  Misc.  Rep.  387,  86  N.  Y.  S.  807 320 

King,  71  App.  Div.  581,  76  N.  Y.  S.  220,  affd.,  172  N.  Y.  616. .   313 

King  ( Renss.  Co.,  not  reported ) 50 

Kitching  v.  Shear,  26  Misc.  Rep.  436,  57  N.  Y.  S.  464 201 

Knoedler,  140  N.  Y.  377 36,  37.     42 

Knower,  N.  Y.  Law  Journal,  Jan.  16,  1904 210 

Knowlton  v.  Moore,  178  U.  S.  41 3-23 

Lane,  39  Misc.  Rep.  522,  80  N.  Y.  S.  381 176,  177 

Lange,  N.  Y.  Law  Journal,  Oct.  26,  1895 344 

Langdon,    11   App.   Div.   220,  43  N.  Y.   S.   419,  affd.,   153   N. 

Y.  6   66,   118,  298 

Lansing,  31  Misc.  Rep.  148,  64  N.  Y.  S.  1125.  .  .  .   255,  262,  330,  344 

Lansing,  182  N.  Y.  238 96,  104,  113,  116 

Lawrence,  96  App.  Div.  29,  88  N.  Y.  S.  1028 260,  331 

Leavitt,  4  N.  Y.  S.  179 300 

Le  Brun,  39  Misc.  Rep.  516,  80  N.  Y.  S.  486 115,  293 

Le  Fever,  5  Dem.  184 300 

Leopold,  35  Misc.  Rep.  369,  7 1  N.  Y.  S.  1032 150 

Lewis  v.  State  of  New  York,  96  N.  Y.  71 212 

Libolt,  102  App.  Div.  29 61,  315,  320 

Liss,  39  Misc.  Rep.  123,  78  N.  Y.  S.  362 308,  311,  312 

Livingston,  1  App.  Div.  568,  37  N.  Y.  S.  8 29,  321 

Locke  v.  State  of  New  York,  140  N.  Y.  480 212 

Lockwood  v.  Middleberger,  159  N.  Y.  181 113 

Lord,  N.  Y.  Law  Journal,  June  3,  1905 154,  202 

Lowry,  89  App.  Div.  226,  85  N.  Y.  S.  924 351 

Ludlow,  4  Misc.  Rep.  594,  25  N.  Y.  S.  989 303 

Lynn,  34  Misc.  Rep.  681,  70  N.  Y.  S.  730 .,...    112 

Magoun  v.  Illinois  Trust  &  Savings  Bank,  170  U.  S.  283 2 

Mahlstedt,  67  App.  Div.  170,  73  N.  Y.  S.  818;  appeal  dismissed, 

171  N.  Y.  652 75 

Manning,  169  N.  Y.  449,  affg.  59  App.  Div.  624,  69  N.  Y.  S. 

1  mo 256,     342 

Maresi,  74  App.  Div.  76,  77  N.  Y.  S.  76.  .276,  295,  296,  306,  308 

314,  315,  317,  321,  324 


454  TABLE   OF    CASES   CITED. 

Matter  of:  PAQE- 

Marks,  40  Misc.  Rep.  507,  82  N.  Y.  S.  803 311,  318 

Masury,  28  App.  Div.  580,  51  N.  Y.  S.  331,  affd.,  159  N.  Y. 

532 79,     85 

Mather,  41  Misc.  Rep.  414,  84  N.  Y.  S.  1105,  90  App.  Div.  382, 

85  N.  Y.  S.  657 109,  110,  189 

McCarthy,  5  Misc.  Rep.  276,  25  N.  Y.  S.  987 372,  376,  377 

McCoskey,  22  Abb.  N.  C.  20 183 

McElroy  v.  Albany  Savings  Bank,  8  App.  Div.  46,  40  N.  Y.  S. 

422   • 51 

McElroy  v.  National  Savings  Bank,  8  App.  Div.  192,  40  N.  Y.  S. 

340 51 

McGarvey,  6  Dem.  145 178 

McGovern,  N.  Y.  Law  Journal,  March  26,  1903 29 

McGruer  v.  Abbott,  47  App.  Div.  191,  62  N.  Y.  S.  123 346 

McMahon,  28  Misc.  Rep.  697,  60  N.  Y.  S.  64 191,  301 

McMurray,  96  App.  Div.  129,  89  N.  Y.  S.  71 15,  179 

McNeill,  N.  Y.  Law  Journal,  June  21,  1902 324 

McPherson,  104  N.  Y.  306 1,  2,  7,  205,  231,  249,  374 

Merriam,  141  N.  Y.  479 2,  43,  184 

Meyer,  83  App.  Div.  381,  82  N.  Y.  S.  329 188,  283 

Miller,  110  N.  Y.  216 .18,  170,  330 

Miller,  45  Hun  244 177 

Miller,  77  App.  Div.  473,  78  N.  Y.  S.  930 65,  255 

Miller  v.  Tracy,  86  N.  Y.  S.  1024 346 

Mills,  86  App.  Div.  555,  67  N.  Y.  S.  956,  affd.,  177  N.  Y.  562. .     29 

Millward,  6  Misc.  Rep.  425,  27  N.  Y.  S.  286 303,  311 

Milne,  76  Hun  328,  27  N.  Y.  S.  727 iv,  v,  195 

Moehring,  154  N.  Y.  423 90 

Moench,  39  Misc.  Rep.  480,  80  N.  Y.  S.  222 18,  202 

Monteith,  27  Misc.  Rep.  163,  58  N.  Y.  S.  379 355 

Moore,  90  Hun  162,  35  N.  Y.  S.  782 170,  182,  195 

Morgan,  36  Misc.  Rep.  753,  74  N.  Y.  S.  478 325,  340,  356 

Morgan,  150  N.  Y.  35 129,  137,  153 

Morgan  v.  Cowie,  49  App.  Div.  612,  63  N.  Y.  S.  608.  .   340,  352,  353 

354,  355 
Morgan  v.  Warner,  45  App.  Div.  424,  60  N.  Y.  S.  963,  affd., 

162  N.  Y   612 252,  267,  361 

Moulton,  11  Misc.  Rep.  694,  33  N.  Y.  S.  578 177 

Murphy,  32  App.  Div.  627,  53  N.  Y.  S.  1110,  affd.,  157  N.  Y. 

679   921 

Murphy,  4  Misc.  Rep.  230,  25  N.  Y.  S.  107 60 


TABLE   OF    CASES    CITED.  455 

Matter  of:  page. 

Newcomb,  71  App.  Div.  606,  76  N.  Y.  S.  222 154 

Nichols,  91  Hun  134,  36  N.  Y.  S.  538 172 

Niven,  29  Misc.  Rep.  550,  61  N.  Y.  S.  956 358 

Norton  v.  Selby  Co.,  118  U.  S.  425 190 

N.  Y.  &  L.  I.  Bridge  Co.,  148  N.  Y.  540 10 

O'Berry,  91  App.  Div.  3,  86  N.  Y.  S.  269,  affd.,   179  N.  Y. 

285 190,  213 

O'Donohue,  44  App.  Div.   186,  59  N.  Y.  S.   1087,  60  N.  Y.  S. 

690  247,  363 

Offerman,  25  App.  Div.  94,  48  N.  Y.  S.  993 29,  61,  321 

Ogsbury,  7  App.  Div.  71,  39  N.  Y.  S.  978 49,  301 

Orr  v.  Gilman,  183  U.  S.  278 93 

Ottendorfer,  N.  Y.  Law  Journal,  Jan.  14,  1903 263 

Page,  39  Misc.  Rep.  220,  79  N.  Y.  S.  382 28,     61 

Page  v.  Edmunds,  187  U.  S.  596 141 

Palmer,  N.  Y.  Law  Journal,  May  11,  1904,  affd.  by  App.  Div. 

First  Dept.  without  opinion 264 

Palmer,  33  App.  Div.  307,  53  N.  Y.  S.  847 182 

Park,  8  Misc.  Rep.  550,  29  N.  Y.  S.  1081 210 

Parmenter  v.  State  of  New  York,  135  N.  Y.  154 213 

Peck   ( not  reported )    168 

Pell,  171  N.  Y.  48 11,  22,  58,  84,  94,  214,  271,  283 

People  v.  Dennison,  84  N.  Y.  272 212 

People  v.  Prout,  117  N.  Y.  650,  affg.  53  Hun  541,  6  N.  Y.  S. 

457    195 

People  v.  Supervisors,  8  N.  Y.  317 10 

People  ex  rel.  Lemmon  v.  Feitner,  167  N.  Y.  1 138,  139,  140 

Peters,  69  App.  Div.  465,  74  N.  Y.  S.  1028 231,  341 

Pettit,   65  App.  Div.  30,  72  N.  Y.   S.  469,  affd.,    171    N.  Y. 

654  124,  231 

Phillips,  N.  Y.  Law  Journal,  May  10,  1905 150 

Phipps,  77  Hun  325,  28  N.  Y.  S.  330,  affd.,  143  N.  Y.  641 .  .   58,     64 

67,  133,  137,  138 

Piatt,  8  Misc.  Rep.  144,  29  N.  Y.  S.  897 194 

Piatt  v.  Grupp,  41  Hun  477 50 

Piatt  v.  Jones,  96  N.  Y.  24 141 

Plum,  37  Misc.  Rep.  466,  75  N.  Y.  S.  940 287 

Plummer,  30  Misc.  Rep.  19,  62  N.  Y.  S.  1024,  affd.,  47  App. 

Div.  625,  62  N.  Y.  S.  1145,  161  N.  Y.  631 45,  60,  152,  393 

Plummer  v.  Coler,  178  U.  S.  115 45,  152,  393 

Post,  5  App.  Div.  113,  38  N.  Y.  S.  977 333 


456  TABLE    OF    CASES    CITED. 

Matter  of:  page. 

Post,  85  App.  Div.  611,  82  N.  Y.  S.  1079 330,  341 

Potter,  51  App.  Div.  212,  64  N.  Y.  S.  1013 4,  113 

Powell  v.  Waldron,  89  N.  Y.  328 141,  145 

Prall,  78  App.  Div.  301,  79  N.  Y.  S.  971 180 

Preston,  75  App.  Div.  250,  78  N.  Y.  S.  91 153 

Prime,  136  N.  Y.  347 v,  21,  181,  182,  184,  231,  249 

Probst  40  Misc.  Rep.  431,  82  N.  Y.  S.  396 48,  151 

Proctor,  41  Misc.  Rep.  79,  83  N.  Y.  S.  643 267 

Prout,  19  N.  Y.  St.  R.  318,  3  N.  Y.  S.  831 376 

Pullman,  46  App.  Div.  574,  62  N.  Y.  S.  395 60,  153,  155,  321 

Purdy,  24  Misc.  Rep.  301,  53  N.  Y.  S.  735 304.  315 

Railroad  Co.  v.  Alabama,  101  U.  S.  832 213 

Railroad  Co.  v.  Tennessee,  101  U.  S.  337 213 

Rathbone  v.  Bank  of  the  Metropolis,  N.  Y.  Law  Journal,  June 

15,  1904 223 

Ray,  13  Misc.  Rep.  480,  35  N.  Y.  S.  481 178 

Rice,  56  App.  Div.  253,  61  N.  Y.  S.  911,  68  N.  Y.  S.  1147.  .  215,  261 

309,  313,  344.  359 

Ridden  v.  Thrall,  125  N.  Y.  572 70 

Riemann,  42  Misc.  Rep.  648,  87  N.  Y.  S.  731 44,  68 

Robertson,  5  Dem.  92 275,  276 

Rogers,  83  App.  Div.  642,  82  N.  Y.  S.  1113 162 

Rogers,  71  App.  Div.  461,  75  N.  Y.  S.  835,  affd.,  172  N.  Y. 

617    114,  115,  321 

Romaine,  127  N.  Y.  80 120,  122,  132,  152,  223,  231 

Roman  Catholic  Church  v.  Niles,  86  Hun  221 18 

Roosevelt,  143  N.  Y.  120 v,  115,  300,  301 

Rosendahl,  40  Misc.  Rep.  542,  82  N.  Y.  S.  992 15 

Rumsey  v.  N.  Y.  &  N.  E.  R.  R.,  130  N.  Y.  88 10 

Rundell  v.  Lakey,  40  N.  Y.  513 307 

Runice,  36  Misc.  Rep.  607,  73  N.  Y.  S.  1120 294 

Schermerhorn,  38  App.  Div.  350,  57  N.  Y.  S.  26 344,  355,  357 

Sanford  v.  Sanford,  45  N.  Y.  723 53 

Schmidt,  39  Misc.  Rep.  77,  88  N.  Y.  S.  879 248 

Schwartz,  N.  Y.  Law  Journal,  Feb.  17,  1903 316 

Scott  v.  Guernsey,  48  N.  Y.  106 278 

Scrimgeour,  175  N.  Y.  507,  affg.  80  App.  Div.  388,  80  N.  Y.  S. 

636,  39  Misc.  Rep.  128,  78  N.  Y.  S.  971 214,  329,  353 

Seabury  v.  Bowen,  3  Bradf .  207 309 

Seaman,  147  N.  Y.  69 17,  18,  24,  25,  27,  31,  66,  85,  187,  298 

Seaver,  63  App.  Div.  283,  71  N.  Y.  S.  544 97,  114,  116,  231 


TABLE   OF    CASES   CITED.  457 

Matter  of:  page. 

Sharer,  36  Misc.  Rep.  502,  73  N.  Y.  S.  1057 82 

Sheedy,  N.  Y.  Law  Journal,  May  25,  1905 50 

Sherar,  25  Misc.  Rep.  138,  54  N.  Y.  S.  930 210 

Sherman,  30  Misc.  Rep.  547,  63  N.  Y.  S.  957 301 

Sherman,  153  N.  Y.  1 152,  211,  392,  393 

Sherwell,  125  N.  Y.  376 1,  3,  231 

Silliman,  79  App.  Div.  98,  80  N.  Y.  S.  336,  affd.,  175  N.  Y. 

513 306,  354,  360 

Singer,  105  App.  Div.  — 160 

Skinner,  45  Misc.  Rep.  559,  92  N.  Y.  S.  972,  modified  on  other 

points,  106  App.  Div.  — ,  94  N.  Y.  S.  144 78,  79,  312 

Slater  v.  Slater,  175  N.  Y.  143 41 

Sloane,  154  N.  Y.  109. .  .  .   iv,  17,  18,  26,  187,  248,  249,  269,  280,  314 

Smith,  14  Misc.  Rep.  169,  35  N.  Y.  S.  701 39,  340 

Smith,  40  App.  Div.  480,  58  N.  Y.  S.  128 16,  360 

Smith,  71  App.  Div.  602,  76  N.  Y.  S.  185 265 

Smith  v.  Cornell,  111  N.  Y.  554 309 

Smith  &  Edwards,  88  N.  Y.  92 278 

Smith  v.  Reeves,  178  U.  S.  436 212 

Solley  v.  Wescott,  43  Misc.  Rep.  188,  88  N.  Y.  S.  297 294 

Sondheim,  32  Misc.  Rep.  296,  66  N.  Y.  S.  726,  affd.,  69  App. 

Div.  5,  74  N.  Y.  S.  510 238 

Spaulding,  49  App.  Div.  541,  63  N.  Y.  S.  694.  ..  .   66,  71,  74,  75 

Spencer,  21  N.  Y.  St.  Rep.  145,  4  N.  Y.  S.  395 173 

Sterling,  9  Misc.  Rep.  224,  30  N.  Y.  S.  385 27,  391 

Stewart,  131  N.  Y.  274 114,  117,  188,  231,  246,  279,  299,  300 

Stickney,  N.  Y.  Law  Journal,  June  9,  1905 8 

Stiger,  7  Misc.  Rep.  268,  28  N.  Y.  S.  163 40 

Stilwell,  69  N.  Y.  St.  R.  381,  34  N.  Y.  S.  1123 172 

Stokes  v.  Weston,  142  N.  Y.  423 278 

Sutton,  3  App.  Div.  208,  38  N.  Y.   S.  277,  affd.,   149  N.  Y. 

618   29,  61,  321 

Swade,  65  App.  Div.  592,  72  N.  Y.  S.  1031 74 

Sweatland,  47  N.  Y.  St.  R.  287,  20  N.  Y.  S.  310 177 

Swift,  137  N.  Y.  77 1,  29,  39,  62,  120,  126,  231,  246,  303,  325 

Tallmadge  v.  Seaman,  9  Misc.  Rep.  303,  30  N.  Y.  S.  304 27 

Thomas,  39  Misc.  Rep.  223,  79  N.  Y.  S.  571 . .  109,  268,  306,  311,  317 

Thomas,  3  Misc.  Rep.  388,  24  N.  Y.  S.  713 58 

Thompson,  57  App.  Div.  317,  68  N.  Y.  S.  18 343 

Thompson,  5   Dem.  393 46 

Thompson  v.  Thompson,  70  App.  Div.  242,  75  N.  Y.  S.  401 ..  .   206 


458  TABLE   OF    CASES   CITED. 

Matter  of:  PAGE. 

Thorne,  44  App.  Div.  8,  60  N.  Y.  S.  419;   appeal  dismissed, 

162  N.  Y.  238 88,  255,  348 

Thrall,  157  N.  Y.  46 iv,  180,  316 

Thurber  v.  Townsend,  22  N.  Y.  517 68 

Totten,  179  N.  Y.  112 49,  50,  348 

Tracy,  179  N.  Y.  501. .  .  .191,  204,  218,  276,  285,  289,  295,  296,  298 

315,  324 

Travis,  19  Misc.  Rep.  393,  44  N.  Y.  S.  349 58 

Trimmer  v.  City  of  Rochester,  134  N.  Y.  76 213 

Tucker,  27  Misc.  Rep.  616,  59  N.  Y.  S.  699 114,  187 

Tuigg,  15  N.  Y.  S.  548 45 

Tuigg,  2  Con.  633 39 

Ullman,  137  N.  Y.  403 229,  231,  341 

U.  S.  v.  Perkins,  163  U.  S.  625 3 

Van  Benthuysen    (not  reported,  1902) 157 

Vanderbilt,  68  App.  Div.  27,  74  N.  Y.  S.  450,  overruled,  172 

N.  Y.  69 287,  316,  323 

Vanderbilt,  10  N.  Y.  S.  239-241 201,  206 

Vanderbilt,  50  App.  Div.  246,  63  N.  Y.  S.  1079,  affd.,  163  N.  Y. 

597   vi,  4,  91,  104,  109,  112 

Vanderbilt,  58  App.  Div.  619,  68  N.  Y.  S.  1150,  affd.,  166  N.  Y. 

640 vi,  4,  112 

Vanderbilt,  172  N.  Y.  69.  .2,  4,  85,  99,  184,  187,  271,  272,  287,  288 

297 

Van  Kleeck,  121  N.  Y.  701 17 

Vassar,  127  N.  Y.  1 8,  16,  58,  183,  246,  254,  255 

Vinot,  7  N.  Y.  S.  517,  26  N.  Y.  St.  R.  610 58,  300 

Von  Post,  35  Misc.  Rep.  367,  71  N.  Y.  S.  1039 357 

Wall,  N.  Y.  Law  Journal,  Jan.  18,  1905;  affd.,  App.  Div.  First 

Dept.,  N.  Y.  Law  Journal,  June  24,  1905 146 

Wallace,  28  Misc.  Rep.  603,  59  N.  Y.  S.  1084 314,  356 

Wallace,  18  N.  Y.  St.  R.  387,  4  N.  Y.  S.  465 301 

Wallace,  71  App.  Div.  284,  75  N.  Y.  S.  838 4,  230,  238 

Wallace  v.  Meyer,  38  Fed.  Rep.  184 152 

Walworth,  66  App.  Div.  171,  72  N.  Y.  S.  984 97,  114,  116 

Watson,  171  N.  Y.  256 iv,  180,  395 

Weed,  10  Misc.  Rep.  628,  32  N.  Y.  S.  777 63 

Weeks   (not  reported,  decision  by  Orange  county  surrogate)  . .  4 

Westcott,  11  Misc.  Rep.  589,  33  N.  Y.  S.  426 300 

Weston  v.  Goodrich,  86  Hun  194,  33  N.  Y.  S.  382 . .   229,  246,  328 


TABLE   OF   CASES   CITED.  459 

Matter  of:  page. 

Westurn,  152  N.  Y.  93. .  .2,  13,  26,  27,  115,  187.  246,  268,  304,  305 

307,  316,  343 

Wheeler,  1  Misc.  Rep.  450,  22  N.  Y.  S.  1075 17f, 

Whiting,  150  N.  Y.  27 60,  120,  128,  137,  152,  153.  21 1 

Whitlock  v.  Bowery  Savings  Bank,  36  Hun  460 50 

Williams,  31  App.  Div.  617,  52  N.  Y.  S.  700 315,  320 

Winters,  21  Misc.  Rep.  552,  48  N.  Y.  S.  1097 249 

Wolfe,  2  Connoly  600,  137  N.  Y.  205 376 

Wolfe,  137  N.  Y.  205 229,  231,  328,  341,  373,  374 

Wolfe,  89  App.  Div.  349,  89  N.  Y.  S.  949,  affd.,   179  N.  Y. 

599 25,  31,  188,  217,  393 

Wood,  40  Misc.  Rep.  155,  81  N.  Y.  S.  511 47,     74 

Wood  v.  Zornstorff,  59  App.  Div.  538,  69  N.  Y.  S.  241 53 

Woolsey,  19  Abb.  N.  C.  232 178 

Wormser,  51  App.  Div.  441,  64  N.  Y.  S.  897 44,  194,  309,  342 

Wortmann  v.  Robinson,  44  Hun  357 50 

Zefita,  167  N.  Y.  280 26,  58,  67,  133,  138 


GENERAL    INDEX. 


GENERAL  INDEX. 


A. 
ACCRUAL  OF  TAX:  page. 

on  certain  remainder  interests 188 

on  future  and  contingent  estates 187 

on  renounced  legacy 188 

provision  of  section  222,  Tax  Law,  not  repealed  by  implication.   191 

under  Act  of  1885 186 

under  Act  of  1892 186,  187 

when  tax  accrues  ( §  222,  Tax  Law) 185 

where  appointment  is  to  be  exercised 97,  187 

where  life  tenant  can  use  principal 188 

ACTS: 

are  construed  as  prospective  unless  retroactive  intent  is  clear. .     17 
first  taxing  personal  property  transferred  to  lineals  and  others 

in  one  per  cent,  class 34,  164 

first  taxing  real  property  transferred  to  lineals  and  others  in 

one  per  cent,  class 34,  164 

first  taxing  property  of  nonresident 34 

of  1885  is  constitutional 2 

of  1887  is  constitutional 3 

of  1892  is  constitutional 3 

Provisions  Declared  Constitutional: 

amendment  of  section  230,  taxing  immediately  contingent  es- 
tates (Chap.  76,  L.  1899) 4 

amendment  appointing  appraiser  in  New  York,  Kings,  and  Erie 

counties  (Chap.  658,  L.  1900) 4 

amendment   allowing   county   treasurers   to   act   as    appraiser 

(Chap.  173,  L.  1901) 4 

amendment  taxing  real  estate  to  one  per  cent,  class  (Chap.  41, 

L.  1903) 5 

amendment  adding  subdivision  5  to  section  220,  relative  to 

power  of  appointment  (Chap.  284,  L.  1897) 3 

Provision  Declared  Unconstitutional: 

part  of  chap.  76,  L.  1899,  taxing  estates  vesting  prior  to  June 

30,  1885 11 

[469] 


464  GENERAL   INDEX. 

ADMINISTRATORS:  page. 

collection  of  tax  by 203 

duty  of,  as  to  payment  of  tax 199 

liable,  although  estate  has  been  distributed 204 

liability  of,  to  pay  tax  ( §  224,  Tax  Law) 198,  204 

subrogation,  for  benefit  of  creditors 206 

what  property  can  be  sold  by,  to  pay  tax 205 

(See  Appraisal;  Appraiser;  Appeals;  Executors.) 

ADOPTED  CHILDREN: 

adopted  under  laws  of  another  State 170 

children  of,  not  included  in  exception 170 

exception  in  favor  of  ( §  221,  Tax  Law) 165 

not  included  in  legacy  to  children,  in  case  of  father's  death. ...  171 

not  included  prior  to  1887 170 

recital  in  will  respecting,  not  conclusive 170 

when  first  included  in  one  per  cent,  class 165 

ADVANCEMENTS: 

are  not  taxable 66 

money  loaned  is  not  an 48 

AGREEMENT: 

antenuptial,  property  passing  by,  not  taxable 64 

gift  in  consideration  of  agreement  to  care  for  donor  for  life ...  87 

gifts  upon  conditions  or  agreements,  when  taxable 80 

AGGREGATE  PROPERTY  TRANSFERRED  TO  TAXABLE  PER- 
SONS: 

determines  the  liability  of  each  transfer  to  taxation 169 

ALBANY  COUNTY: 

appraiser  in  ( §  229,  Tax  Law) 234 

salary  of  235-272 

transfer  tax  clerk  in  ( §  234,  Tax  Law) 368 

salary  of 368 

AMENDMENTS: 

by  chapter  368  of  the  Laws  of  1905 21 

chapter  76,  Laws  1899,  amending  section  230,  did  not  change 
provisions  of  subdivision  5,  section  220,  respecting  taxation 

of  transfers  by  exercise  of  power  of  appointment 98 

not  retroactive  unless  stated  to  be 17 

(See  Acts;  Constitutionality.) 

AMERICAN  EXPERIENCE  TABLE  OF  MORTALITY: 

showing  value  of  annuity  of  $1  at  various  ages,  and  value  of 

remainders  at  corresponding  ages 258,  259 


GENERAL  INDEX.  465 

ANCILLARY  LETTERS:  page. 

can  only  issue  with  consent  of  foreign  executor 232 

Comptroller  to  be  cited  upon  application  for  (§  228,  Tax  Law),  227 

petition  for,  what  must  contain 228 

unnecessary,  for  transfer  tax  proceedings 232 

ANNUITY: 

American  experience  tables  for  computing 258 

fund  to  pay  annuity  created  by  trust  deed  is  not  taxable 62 

payment  of  tax  upon 295 

present  value  of,  instead  of  amount  necessary  to  produce,  is 

proper  deduction  314 

tax  on  fund,  subject  to 295 

to  continue  only  while  annuitant  remained  in  the  employ  of 

decedent's  daughter,  value  of,  how  payable 285 

to  executor  and  trustee,  when  taxable 42 

value  of,  how  ascertained 294 

when  cost  of,  determines  its  value  and  is  deductible  from  the 
residuary  estate    295-314 

ANTENUPTIAL  AGREEMENTS: 

transfers  by,  not  taxable 64 

APPEALS  ( §  232,  Tax  Law) 337 

accepting  payment,  don't  affect  right  to 344 

corresponding  sections  of  former  acts  relating  to 349 

costs  on 344 

allowance  of,  carries  disbursements 345 

governed  by  section  3240  of  the  Code 345 

when  not  properly  imposed  on  moving  party 345 

executors'  right  to  338 

failure  of  surrogate  to  give  notice  don't  affect 343 

immaterial  whether  tax  can  be  collected  or  not,  if  transfer  is 

taxable 339 

is  to  the  surrogate  ( §  232,  Tax  Law) 337-340 

necessity  of  stating  grounds  of 341 

object  of  stating  grounds  of 342 

only  parties  aggrieved  can 339 

only  remedy,  when  340 

surrogate  can  construe  will  on 34 1 

surrogate  may  receive  additional  evidence  on  the  appeal  and 

consider  new  questions,  when 342,  343 

the  order  appealed  from 341 

the  surrogate's  discretion,  upon 343 

time  within  which  appeal  can  be  taken  (§  232,  Tax  Law) 337 

30 


466  GENERAL    INDEX. 

APPEALS—  Continued:  page. 

to  the  Appellate  Division 346 

failure  to  except  to  ruling  not  a  prerequisite  to  review. . .  346 
will  not  interfere  with  surrogate's  refusal  to  direct  a  re- 
fund    347 

will  only  consider  the  grounds  of  appeal 346 

to  the  Court  of  Appeals: 

matters  in  surrogate's  discretion  not  subject  to  review ....  347 
order  of  reversal  upon  the  law  and  the  facts  is  reviewable 

when  no  question  of  fact  is  involved 348 

when  unanimous  decision  of  Appellate  Division  is  revers- 
ible   348 

when  will  be  dismissed 348 

to  whom  and  how  perfected 340 

where  appraiser  refuses  to  appraise  an  asset 339 

when  order  becomes  final 344 

where  Comptroller  was  not  a  party 340 

who  can  appeal 338 

(See  Appraisal;  Modification  of  Orders;  Surrogate.) 
ACCRUED  RIGHTS: 

if  prior  to  Tax  Law,  not  taxable 57 

the    word     "  vested  "    is    construed    as    equivalent    to    "  ac- 
crued " 84,  85 

APPENDIX: 

statute  of  distribution 399 

statute  of  descent  402 

the  estates  of  married  women,  provision  of  the  Code  respecting.  402 
APPLICATION  OF  TAXES: 

former  acts  relating  to 388 

to  expenses  of  State  government,  etc.  (§  241,  Tax  Law) 388 

APPOINTEE  CAN  ELECT: 

to  take  under  exercise  of  power,  or  by  former  deed  or  will 95 

APPOINTMENT.     (See  Power  of  Appointment.) 
APPRAISAL  (|  230,  Tax  Law) : 

application  of  State  Comptroller  for,  on  information  and  be- 
lief    247 

appraisal  of  interest,  when  postponed 248 

burden  of  proof 255 

competency  of  witness  253 

conclusiveness  of  359 

effect  of  failure  to  tax  known  property 254 


GENERAL    INDEX.  467 

APPRAISAL  —  Continued :  PAGE. 

evidence  as  to  declaration  of  testator 252 

former  proceeding   262 

increase  of  property,  not  to  be  appraised 254 

new  proceeding  for -"- 

note  owned  by  decedent,  in  litigation,  should  be  reserved 307 

notice  of:  appraisal  void  if  made  without 248 

what  held  sufficient  under  Act  of  1887 249 

of  bonds,  stocks,  and  securities 262 

of  disputed  claim  268 

of  inactive  stock  267 

of  interest  subject  to  contingent  incumbrance 285 

of  life  estate,  where  life  tenant  dies  before  appraisal 276 

of  note3  directed  to  be  canceled 267 

of  notes  or  claims  in  litigation 268 

of  remainder  interests,  where  annuitant  exceeds  his   expecta- 
tion of  life 2" 

of  residuary  estate,  when  part  subject  to  appointment 254 

of  stock  of  joint-stock  associations 266 

of  domestic  corporations,  surrogate  having  jurisdiction 232 

of  stock  where  there  is  no  market  value 266 

of  unlisted  stock   265 

people,  were  an  interested  party,  under  Act  of  1885 250 

property  should  be  appraised,  and  transfer  taxed,  without  refer- 
ence to  how  same  can  be  collected 330 

second  appraisal,  cannot  increase  value 260 

nor  decrease   deductions    261 

stock  of  domestic  corporations,  at  the  market  value,  regardless 

of  where  capital  is  employed 264 

Superintendent  of  Insurance  to  determine  value  of  certain  es- 
tates      327 

surrogate  directs,  either  on  his  own  motion,  or  application  of 

interested  party  ( §  230,  Tax  Law) 241 

testimony  of  legatee "53 

the  general  subject : 

relating  to  deductions 303 

relating  to  future  and  limited  estates   275 

relating  to  proceedings  by  appraisers 268 

the  test  of  value 2;i" 

what  statute  controls 248 

when    failure    to    tax    life    estate    amounts    to    a    reservation 
thereof "55 


468  GENERAL    INDEX. 

APPRAISAL  —  Continued :  page. 

when  nonresident  executor  not  obliged  to  testify 253 

when  not  regular   250,  261 

when  second  appraisal  cannot  be  had 904 

who  can  make  application  for 247 

worthless  account  to  be  excluded 255 

(See  Appraiser;  Deductions;  Future  and  Limited  Estates;  Power  of 

Appointment;  Reappraisals;  Surrogate.) 
APPRAISERS  (§  230,  Tax  Law): 

appointment  of;  bond  of;  oath  of  ( §  229,  Tax  Law) 234 

appointment  of,  by  the  Supreme  Court   (§  232,  Tax  Law) 337 

when  to  be  appointed 337 

determination  of  justice  supersedes  the  former  determina- 
tion of  the  surrogate 338 

is  to  be  filed  in  office  of  State  Comptroller  and  certified 
copy  transmitted  to  the  Surrogate's  Court  of  the  proper 

county 338 

act  appointing  in  New  York,  Kings,  and  Erie  counties  is  con- 
stitutional         4 

corresponding  sections  of  former  acts  relating  to  proceedings  by 

appraiser 268 

county  treasurer,  when  to  act  as  ( §  230,  Tax  Law) 241 

act  requiring,  is  constitutional 238 

former  acts  relating  to  appointment  of 236 

hearing  before    250 

must  appraise  property  at  its  fair  market  value 242 

notice  of  appraisal  to  be  given  by 241 

power  of   250 

can  subpoena  witnesses,  etc 242,  251 

may  report  as  to  date  of  decedent's  death 251 

proceedings  by   ( §  230,  Tax  Law) 241 

remedy  when  appraiser  refused  to  appraise  an  asset 339 

report  of  256 

conclusiveness  of  359 

form  of 415 

must  be  in  duplicate 245 

surrogate  may  return,  when 260,  331 

surrogate  to  fix  value  of  all  estates  from 328 

what  should  contain   256 

what  should  show   256 

when  defective,  should  vacate  order 260 

when  insufficient   261 


GENERAL   INDEX.  469 

APPRAISERS  —  Continued :  page. 

salaried  in  certain  counties  ( §  229,  Tax  Law) 234,  235 

bond  of,  oath  of 23-5 

taking  fee  or  reward 2J68 

traveling  expenses,  etc.,  how  paid 2.42 

when  appraiser  to  be  appointed 24fi 

(See  Appraisal;   Deductions;   Determination  of  Surrogate;   Future, 
and  Limited  Estates;  Power  of  Appointment;  Reappraisal.) 

ARTICLES  MENTIONED  IN  SECTION  2317  OF  THE  CODE: 

are  not  to  be  deemed  assets fil 

not  entitled  to  money  allowance  therefor 319 

ASSETS  OF  THE  ESTATE: 

what  shall  be  deemed 37 

B. 

BANKS: 

consent  of  Comptroller  to  transfer,  how  obtained 222 

corporations  transfer  at  their  peril,  when 223 

liability  of,  to  pay  tax  ( §  227,  Tax  Law) 219 

obligation  to  give  the  notice  rests  upon  the  bank 223 

penalty,  when  incurred 221 

transfers  of  property  held  by 219,  220,  221 

(See  Nonresident  —  Taxable  Transfers;  Nonresident  —  Nontaxable 
Transfers;  Taxable  Transfers.) 

BENEFICIALLY  ENTITLED: 

accrual   and   payment   of  tax  when  legatee  becomes    (§   222, 

Tax  Law)    185 

meaning  of  provision  28 

to  whom  payment  to  be  made 186 

when  person  becomes   38 

BENEVOLENT  CORPORATION: 

exemption  of  ( §  221,  Tax  Law) 165 

when  first  exempted  166 

BEQUEST  FOR  BURIAL  PLOT: 

is  not  taxable 58 

BEQUEST  WITH  PRECATORY  WORDS: 

in  favor  of  exempt  corporations 59 

BIBLE  SOCIETIES: 

exemption  of  ( §  221,  Tax  Law) 104 

when  first  exempted 168 

BISHOP: 

exemption  of  ( §  221,  Tax  Law) 165 

applies  to  a  nonresident  bishop 182 


470  GENEKAL   INDEX. 

BISHOP—  Continued: 

exemption  of —  Continued:  page. 

bequest  to,  "  or  to  his  living  successor  " 182 

includes  archbishop  or  cardinal  bishop 182 

when  first  exempted   165 

BOND  AND  MORTGAGE: 

held  by  husband  and  wife  jointly 54 

BONDS: 

memoranda  of  decision  affecting  taxability  of 152-156 

nonresident  decedents,  bonds: 

of  domestic  corporations,  when  taxable 125 

of  foreign  corporations,  when 128 

registered  and  coupon  bonds  of  foreign  corporations  are 

taxable  if  here 129 

of  the  United  States,  taxable  prior  to  1892  and  after  1898.  .   45-152 

pledged,  are  not  taxable 153 

if  indebtedness  is  discharged   before  appraisal,   then  are 

taxable 154 

secured  by  mortgage  on  land  in  this  State,  owned  by  nonresi- 
dent, when  taxable   153 

BOOKS  AND  FORMS: 

to  be  furnished  by  State  Comptroller   (§  238,  Tax  Law) 383 

former  sections  relative  to 384 

BURIAL  PLOT: 

bequest  for,  is  exempt 58 

C. 
CERTIFICATE: 

for  payment  of  tax  on  real  property    (§  236,  Tax  Law),  fee 
for  * 379,  380 

CASES  CITED: 

Table  of 447 

CERTIFICATES  OF  DEPOSIT: 

when  taxable 4?,  *4' 

CHARACTER  OF  THE  LAW: 

is  a  special  State  tax 246 

CHARITABLE  CORPORATIONS: 

exempt  by  section  221,  Tax  Law 165 

when  first  exempted 166 

CHOSE  IN  ACTION: 

when  taxable   "6 

COLLATERALS: 

distribution   among    28 

no  representation  after  brothers'  and  sisters'  descendants 29 


GENERAL    INDEX.  471 

COMMISSION  TO  TAKE  TESTIMONY:  page. 

surrogate  can  issue 230 

what  moving  papers  must  show 230 

COMPOSITION  AGREEMENTS: 

executed  in  triplicate 365 

form  of 436 

former  acts  relating  to '  .  . 366 

State  Comptroller  can  make  ( §  233,  Tax  Law)    364 

with  consent  of  Attorney-General  thereto 364 

where  to  be  filed 364 

COMPTROLLER.     (See  State  Comptroller.) 
CONSTITUTIONALITY : 

Act  of  1885 2,  120 

Act  of  1887   3 

Act  of  1892 3 

Act  of  1903   (chapter  41) 5 

county  treasurers  acting  as  appraisers 4,  238 

of  act  taxing  transfers  by  nonresident  decedents 121 

subdivision  5,  section  220,  Tax  Law,  is  constitutional 3 

part  of  chap.  76,  L.   1899,  relating  to  immediate  taxation  of 

contingent  estates  is 4 

part  of,  relating  to  the  taxation  of  estate  vesting  prior  to 

June  30,  1885,  is  unconstitutional 11 

provision  relating  to  appointment  of  appraiser  in  New  York, 

Kings,  and  Erie  counties 4,  238 

taxing  real   property  transferred  to  persons  in  one  per  cent. 

class  5 

(See  Acts;  Amendments.) 
CONSTRUCTION  OF  THE  ACT: 

in  favor  of  the  citizen 246 

CONTEMPLATION  OF  DEATH  OF  DONOR: 

gifts    (causa  mortis) ,  or  made  in,  etc 70-73 

literal  construction  of  the  statute  not  intended 71 

statute  in  respect  to  gifts  made  in  (§  220,  Tax  Law) 34 

to  what  the  words  refer 74 

transfers,  not  made  in 74,  75,     76 

CONTINGENT  ESTATES: 

presently  taxable  «ince  chap.  76,  L.  1899 4,  286,  288 

exception:  where  life  tenant  can  use  part  or  all   of  the 

principal 290,  291 

where  life  tenant  can  exercise  power  of  appointment.  .   293 

when  taxable  prior  to  1899 300 

CONTRACT  OBLIGATIONS: 

property  transferred  by  reason  of 65 


472  GENERAL  INDEX. 

CONVERSION  — EQUITABLE:  page. 

could  not  be  invoked 29 

where  legatee  dies  before  conversion  takes  place 29 

CORPORATIONS: 

legacy  to  be  used  in  founding 63 

"  specifically  exempted  "    ( §  221,  Tax  Law) 164 

CORPORATIONS  ORGANIZED  EXCLUSIVELY  FOR  BIBLE  OR 
TRACT  PURPOSES: 

exempt  by   section  221,  Tax  Law 165 

when  first  exempted 166 

CORRESPONDING  SECTIONS  OF  FORMER  ACTS  —  RELATING 
TO: 

Appeals 349 

application  of  taxes  ( §  241,  Tax  Law) 388 

books  and  forms  to  be  furnished  by  the  State  Comptroller ....   384 

composition  agreements 366 

determination  of  the  surrogate   333 

discount  and  interest   ( §  223,  Tax  Law) 214 

district  attorney  proceedings   377 

exemptions,  see  "  specifically  exempted  " 178 

fees  of  county  treasurer 382 

liability  of  certain  corporations  to  tax   (§  227,  Tax  Law)  ....   224 

proceedings  by  appraisers   268 

receipts  by  Comptroller  and  county  treasurer 380 

reports  of  county  treasurers 386 

report  of  State  Comptroller 3"87 

reports  of  surrogate  and  county  clerk 385 

surrogate's  assistants,  clerks,  etc 369 

taxable  transfers  (§  220,  Tax  Law) 19,     21 

COSTS  ON  APPEAL: 

allowance  of 344 

carries  disbursements  also 345 

governed  by  section  3240  of  the  Code 345 

when  not  properly  imposed  on  moving  party 345 

COUNSEL: 

State  Comptroller  may  retain  (§  235,  Tax  Law) 371 

fees  allowed  in  collecting  tax  on  estates  of  nonresident  de- 
cedents   371,  372 

COUNTY  CLERK: 

quarterly  report  of   ( §  239,  Tax  Law) 384 

COUNTY  TREASURERS: 

are  to  act  as  appraisers  in  certain  counties  (§  230,  Tax  Law)  . .   241 
law  authorizing,  is  constitutional 4,  238 


GENERAL    INDEX.  473 

COUNTY  TREASURERS—  Continued:  page. 

defined   ( §  242,  Tax  Law) 389 

fees  of  ( §  237,  Tax  Law) 382 

former  acts  relating  to  fees  of 382 

receipts  issued  by   ( §  236,  Tax  Law) 379 

duplicate  receipts  and  fee  for 380 

former  acts  relating  to  receipts 380 

reports  of.  when  to  be  made  ( §  240,  Tax  Law) 385 

CURTESY: 

taxability  of  estate  by 68 

D. 
DEBTS: 

debt  on  open  account  due  by  domestic  association 151 

due  from  a  legatee   40 

legacies  in  payment  of    44 

owing  by  residents  to  nonresident  decedents 47,  142 

taxing  debts,  etc.,  erroneously  allowed  (§  225,  Tax  Law)  .  .209,  215 

when  cannot  be  deducted,  after  appraisal 325 

when  debt  due  nonresident  decedent  was  held  not  taxable 151 

DEDUCTIONS   (§  230,  Tax  Law)  : 

articles  enumerated  in  section  2713  of  the  Code,  not  entitled  to 

money  allowance  for 319 

bond  of  decedent,  when  not  deducted  from  personal  property.  .  318 

commission  of  executors  and  administrators 305 

commissions  of  foreign  executors   306 

commissions  of  temporary  administrator   305 

commissions  of  trustee 306 

claim  against  decedent's  estate 309 

cost  of  burial  plot 311 

counsel   fees    306 

when  not  allowed   316 

debts  due  New  York  creditors  by  nonresident  decedents 313 

debts  owing  by  nonresident,  when  not  allowed 321 

debts  to  be  apportioned  between  exempt  and  nonexempt  prop- 
erty    3 1 ;  > 

when  cannot  be  deducted  after  appraisal 325 

when  not  allowed   316 

disbursements  for  benefit  of  estate 306 

disbursements  of  executor  of  administrator 310 

doubtful  and  uncertain  claims 309,  313 

estimated  expenses  of  administration 307 

executor's   commissions   as   trustee 306 

when  not  to  be  deducted 310 


47-1-  GENERAL    INDEX. 

DEDUCTIONS  —  Continued :  page. 

expenses  of  litigation,  when 30G 

expenses  of  unnecessary  action,  not  allowed 31G 

federal  tax  was  not  a 322 

funeral  expenses   311 

judgment    secured  by  indemnity  bond  and  mortgage  is  not  a.  .    312 

legacy  to  a  creditor  is  not 320 

legacy  to  one  specifically  exempted  is  a 179 

mortgage  debts,  were  not  allowed  against  personal  property..   321 

note  owned  by  decedent  in  litigation,  should  be  reserved 307 

present  value  of  annuity  is 314 

repairs  to  real  estate,  when  not  allowed  as 324 

sums  paid  for  withdrawal  of  objection  to  probate,  not  allowed.  .  318 
tax  directed  to  be  paid  as  an  administration  expense,  is  not.  .  324 
tax  paid  on  transfer  in  another  State  is  not  to  be  deducted .  .  322 
taxes : 

assessed  in  decedent's  lifetime 308 

due  at  decedent's  death 300 

under  Greater  New  York  Charter 307 

when   not   deductible 324 

when  assessment-roll  completed 308 

the  general  subject,  relative  to 303 

when  cost  of  annuity  is 314 

widow  is  entitled  to  money  equivalent  in  lieu  of  provisions  and 

fuel,  when  31o 

when  value  of  particular  estate  is 314 

(See  Appraisal;  Appraiser;  Surrogate;  Future  and  Limited  Estates.) 
DEFINITIONS: 

"  estate  "   (  §  242,  Tax  Law) 389,  390 

as  interpreted  prior  to  1892 390 

same  construction  as  to  property  passing  to  lineals   and 

others,  by  the  amendment  in  1891 391 

"  transfer  "  defined  by  (§  242,  Tax  Law) 389 

by  the  courts. 23,  87,  393 

there  is  no  transfer  by  will,  unless  legacy  is  accepted 393 

"  property,"  not  limited  to  definition  under  General  Tax  Law. .      36 

section  242,  Tax  Law 389 

what  exempted  by  definition  of,  in  1892 392 

what  included  in  definition  of 392 

personal  property  under  Statutory  Construction  Law 37 

powers  under  Real  Property  Law 89 

when  word  "  children  "  is  equivalent  to  "  descendants  " 177 

DEED: 

to  what  the  word  refers  in  this  act 27 


GENERAL   INDEX.  475 

DEFERRED  PAYMENTS:  page. 

effect  of  electing  to  defer  payment  since  chap.  76,  L.  1899 218 

former  section  relating  to,  omitted 217 

DEPOSIT  WITH  BANK  TO  PROTECT  A  MARGIN: 

when  taxable 48 

DESCENT: 

i*  a  creature  of  the  law 2 

is  effected  by  operation  of  law 32 

statute  of 402 

DETERMINATION  OF  SURROGATE  (§  231,  Tax  Law) 326 

amount  of  tax,  how  determined 328 

appointment  of  guardian  by  surrogate 333 

to  be  appointed  at  any  stage  of  the  proceedings 327 

corresponding   sections   of   former   acts   relating  to  the   deter- 
mination of  the  surrogate   333 

how  far  conclusive 330 

interests  of  beneficiary  under  order 331 

is  final  as  to  known  property 330 

notice  of  determination,  to  whom  given 327,  329 

order  of  exemption,  ex  parte  application  for 332 

power  of  surrogate  to  correct  clerical  errors 332 

presumption  of  notice  of 329 

report  can  be  sent  back  for  correction 331 

taxing  order,  is  the  order  of  the  surrogate's  court 329 

the  surrogate  is  the  assessing  and  taxing  officer 328 

vacating  order,  newly-discovered  evidence 331 

value  of  the  estate  and  amount  of  tax.  how  determined 328 

when   application  to  the   Superintendent  of   Insurance  neces- 
sary    275,  329 

when  order  not  entered  by  consent 330 

(See  Appraisal;    Surrogate.) 

DEVISE: 

is  a  creature  of  the  law 2 

not  a  natural  right 2 

DEVOLUTION  OF  TITLE: 

tax  attaches  upon 26 

tax  on.  where  legacy  is  renounced 30 

tax  is  upon,  in  case  of  intestacy 2 

DISCOUNT: 

amendments  affecting 192,  193 

decisions  relating  to 195 

statute  respecting  ( S  223,  Tax  Law) 192 


476  GENERAL   INDEX. 

DISCOUNT  — '  Continued :  page. 

suggestion  respecting 193 

when  allowed  192,  193 

DISTRICT  ATTORNEY  PROCEEDINGS: 

certificate  of  "  probable  cause  " 372 

corresponding  section  of  former  acts,  relating  to 377 

costs  to  district  attorney 376 

when  unsuccessful 377 

defined  (§  242,  Tax  Law) 389 

former  adjudication,  exempting  legacy,  is  a  bar  to 374 

how  commenced 374 

not  until  after  the  expiration  of  eighteen  months  from  the 

accrual  of  tax 370 

order  directing  payment 375 

how  enforced  376 

proceedings  by  ( §  235,  Tax  Law) 370 

proceeding  is  not  in  nature  of  an  action  for  a  penalty 376 

what  can  be  shown  upon  return  of  citation 374 

when  correctness  of  assessment  cannot  be  raised 375 

when  proceedings  to  be  commenced 372 

which  district  attorney  can  bring 373 

DOWER: 

legacy  in  lieu  of  dower  is  taxable,  if  accepted 44 

widow's  dower  is  not  taxable 67 

DUTCHESS  COUNTY: 

appraiser  in   ( §  229,  Tax  Law) 234 

salary  of  235 

transfer  tax  clerk  in  ( §  234,  Tax  Law) 369 

salary  of  369 

E. 

EDUCATIONAL  CORPORATIONS: 

exemption  of  (§  221,  Tax  Law) 165 

when  first  exempted 166 

EQUITABLE  CONVERSION: 

could  not  be  invoked 29 

upon  failure  to  exercise  appointment Ill 

where  legatee  dies  before  conversion  takes  place 29 

ERIE  COUNTY: 

appraiser  in  ( §  229,  Tax  Law) 234 

salary  of 235 

clerk  to  appraiser ;  salary  of  ( §  234,  Tax  Law) 367 


GENERAL    INDEX.  477 

ERRONEOUS  PAYMENT:                                                                   page. 
when  not  considered  made  "  in  advance  " 99 

ESTATE: 

amount  of  determines  taxability  of  all  transfers 13 

denned  ( §  242,  Tax  Law) 389 

less  than  $500,  is  not  taxable  ( §  220,  Tax  Law) 34 

meaning,  prior  to  1892 27 

meaning  since  the  Act  of  1892 13 

ESTATES  OF  MARRIED  WOMEN: 

provision  of  the  Code  respecting  distribution  of 402 

EVIDENCE: 

additional,  on  appeal  to  surrogate 342 

appraiser  is  to  take  ( §  230,  Tax  Law) 242 

respecting  new  questions,  on  appeal  to  surrogate 342 

usually  first  given  in  form  of  affidavits 250 

EXCEPTIONS  AND  LIMITATIONS  (§  221,  Tax  Law) 164 

(See  Exceptions;  Exemptions;  Limitations.) 

EXECUTORS: 

annuity  to,  when  taxable 42 

bequests  to,  in  lieu  of  commissions  ( §  226,  Tax  Law) 216 

collection  of  tax  by 203 

duty  of,  generally,  as  to  payment  of  tax 199 

legacy  to,  subject  to  a  trust 58 

liable,  although  estate  has  been  distributed 204 

liability  of  foreign,  to  pay  tax 219 

liability  to  pay,  cannot  be  decided  on  motion 206 

not  entitled  to  a  final  accounting,  where  a  tax  is  due  until  he 

produces  a  receipt  showing  payment 204,  379 

personal  liability  to  pay  tax  ( §  224,  Tax  Law) 198,  204 

right  of  foreign,  to  apply  decedent's  property  in  paying  legacies.  156 

right   of,   to   appeal 338 

sale  of  what  property,  to  pay  tax 205 

subrogation  for  benefit  of  creditors 206 

tax  on  legacy  to,  when  renounced 217 

tax  on  real  estate,  not  to  be  assessed  against 205 

when  liability  ends 206 

EXCEPTIONS   (§  221,  Tax  Law)  : 

adopted  children    170 

amendments  affecting  165,  166 

husband  of  daughter,  includes  a  widower 178 

remarriage  prior  to  transfer  to,  don't  affect 178 

lineal  descendants,  who  are 177 

made  by  section  221,  Tax  Law 164 


478  GENERAL    INDEX. 

EXCEPTIONS  —  Continued :  PAGE- 

to  mutually  acknowledged  relation  of  parent  (§  221,  Tax  Law).  164 

when  first  excepted    165 

provision  as  to  age  of  child 165 

provision  as  to  child's  parents  being  dead 165 

to  one  per  cent,  class  taxable  persons 164 

decedent's  grandmother  is  not  included  in 168 

EXEMPTIONS: 

amendments  affecting   165,  166 

articles  mentioned  in  section  2713  of  Code 61 

Bible  and  tract  societies    ( §  221,  Tax  Law) 161 

when  first  exempted   166 

bishop  and  religious  corporations,  when  first  exempted 165 

includes  archbishop  and  cardinal  bishop 182 

corporations : 

benevolent,  charitable,  educational,  hospital,  infirmary,  or 

missionary,   when   first   exempted 165,166 

organized  exclusively  for  Bible  and  tract  purposes 166 

scientific,  historical,  literary  corporations  and  associations, 

exempted  in  certain  cases   (§  221,  Tax  Law) 165 

when  first  exempted   166 

foreign  religious  corporations  not  exempted 184 

one  claiming,  must  show  statute  allowing 182 

provisions  of  article  1  not  applicable  (§  243,  Tax  Law) 394 

when  this  section  first  included  in  the  Transfer  Tax  Law. .   394 
provisions  of  section  243  did  not  apply  to  certain  bequests.  ...    IS! 

"  specifically  exempted  "   ( §  221,  Tax  Law) 164 

legacy  to  one,  is  to  be  deducted I"1-1 

applies  only  to  domestic  corporations 181 

certain  corporations,  by  Act  of  1905 164,   1S1 

decision  affecting  exemptions  generally 182 

to  "  husband  of  a  daughter  "  includes  widower ITS 

what  the  words  "  now  exempt  by  law  "  refer  to 183 

who  included  in  the  term 178 

F. 
FIVE  PER  CENT.  CLASS  (§  220,  Tax  Law) 34 

who  included  in  16k 

FOREIGN  CORPORATIONS: 

stocks  of,  when  taxable 43 

FOREIGN  EXECUTOR,  ETC.: 

commissions  of,  are  deductible   306 

consent  of,  is  necessary  before  ancillary  letters  can  issue 232 


GENERAL    INDEX.  479 

FOREIGN  EXECUTOR,  ETC.— 'Continued:  page. 

liability  of,  to  pay  tax  ( §  227,  Tax  Law)    219 

is  not  obliged  to  testify  as  to  decedent's  property  without  this 

State 253 

(See  Administrator;  Executor.) 
FORMER  SECTION  226: 

relating  to  deferred  payments 217 

omitted  from  Act  of  1905 217 

FORMS: 

generally   409-444 

index  to 507 

FUNERAL  EXPENSES: 

of  decedent  to  be  deducted 311 

what  included  in 311 

FUTURE  AND  LIMITED  ESTATES: 

value  of,  how  determined   (§  230,  Tax  Law) 241 

accrual  of  tax  on 187 

annuities,  value  of,  how  ascertained 294 

tax  on  fund  subject  to 295 

when  cost  of,  determines  its  value 295 

contingent  remainders  since  1899  are  presently  taxable 286 

exceptions:   where  life  tenant  can  use  part  or  all  of  the  prin- 
cipal     291 

where   life   tenant   can   exercise   a   power   of   appointment 

over  the  fund 293 

decisions  affecting,  prior  to   1899 299 

defeasible  interests,  transfer  of,  refers  to  testator's  death 299 

discretionary  power  to  use  principal  creates  voidable  trust....   294 
history  of  the  law  affecting  life  estates  and  remainders  prior 

to  1899  279 

increase   accruing,    when   deemed    a    taxable   transfer    (§    230, 

Tax  Law)   244,  286 

law  does  not  apply  to  remainders  and  reversions  created  before 

it  went  into  effect 298 

provisions  of  Act  of  1899  relative  to  taxing  contingent  estates 
and  the  payment  of  tax  immediately  thereon,  apply  equally 
to  the  payment  of  tax  on  vested  remainders  forthwith  from 

the  trust  estate 288 

remainders  created  by  deed  (Act  of  1885) 299 

subject  to  a  contingent  incumbrance 285 

tax  on  remainders  in  trust  estates  are  presently  payable.  .   288,  289 


180  GENERAL    INDEX. 

FUTURE  AND  LIMITED  ESTATES—  Continued:  page. 

taxing  expectant  estates  at  their  full  undiminished  value 282 

the  general  subject  ( §  230,  Tax  Law) 241,  275 

upon  the  exercise  of  a  power  of  appointment 89,  285 

value  of,  how  determined  (§  231,  Tax  Law) 327,  329 

when  a  voidable  trust  is  created 294 

where  annuitant  exceeds  his  expectation  of  life 277 

where  life  tenant  died  before  appraisal 276 

words,  not  enlarging  a  life  estate 294 

(See  Appraisal;  Power  of  Appointment.) 

G. 
GIFTS: 

agreement  to  care  for  donor,  for  life 87 

inter  vivos,  not  taxable 74 

inter  vivos  and  causa  mortis,  distinction  between 70 

literal  construction  of  the  statute  not  intended 71 

made  in  contemplation  of  death 73 

not  made  in  contemplation  of  death 74 

made  to  take  effect  at  donor's  death 77,  80 

not  made  to  take  effect  at  donor's  death 82 

property  rights  in;  accrual  of  right,  etc 84 

upon  conditions  or  agreements 80 

what  necessary  to  consummate 70,  71 

when  taxable  under  the  statute  (§  220,  Tax  Law) 34 

when  transfer  by  trust  deed  does  not  constitute 77 

words  of  present  gift,  when  not  necessary 86 

GOOD  WILL  OF  BUSINESS: 

is  taxable 41 

firm  name  is  a  part  of  41 

GRANTEE: 

when  entitled  to  absolute  fee 112 

GRATUITY  FUND,  N.  Y.  PRODUCE  EXCHAGE: 

proceeds  of,  not  taxable 61 

GUARDIAN: 

appointment  of 333 

at  any  stage  of  the  tax  proceedings 327 

H. 

HEIR: 

judgment  against,  when  taxable 39 


GENERAL    INDEX.  481 

HISTORY  OF  THE  LAW:  page. 

affecting  life  estates  and  remainders  prior  to  1899 279 

introductory  iii-vii 

taxing  transfers  of  property  of  nonresident  decedents 121 

(See  Corresponding  Sections  of  Former  Acts;  also  footnotes  at  the 
end  of  each  section  of  the  Tax  Law.) 

HOSPITAL  CORPORATION: 

exemption  of  (§  221,  Tax  Law) 165 

when  first  exempted 166 

HUSBAND  OF  A  DAUGHTER: 

bequest  to,  when  exempt 164 

includes  widower 178 

remarriage  prior  to  transfer,  does  not  affect 178 

I. 

INCREASE: 

accruing  after  decedent's  death,  not  taxable 58 

INDEX  TO  FORMS 507 

INFIRMARY  CORPORATION: 

exemption  of  (§  221,  Tax  Law) 165 

when  first  exempted 166 

INHERITANCE  TAX: 

is  one  on  succession 2 

INSURANCE  POLICIES: 

when  taxable 42 

INTEREST : 

amendments  affecting 192,  193 

changes  of  the  law  affecting 193 

decisions  relating  to 195 

ignorance  of  the  law  will  not  excuse  payment  of 194 

liability  to  pay,  is  an  accrued  right 195 

remission   of,  application  for 194 

cannot  be  remitted  altogether 194 

to  whom   made 194 

when  denied 194 

statute  affecting  ( §  223,  Tax  Law) 19,  193 

under  Act  of  1885 192 

under  Act  of  1887 193,  195 

when  attaches 192,  195 

when  will  attach  to  a  refund 213 

INTESTATE  LAWS: 

distribution  among  collaterals 28 

transfers  by,  affected  by  operation  of  law 32 

31 


482  GENERAL   INDEX. 

INTESTATE  LAWS—  Continued:  PAGE. 

statute  of  descent 402 

statute  of  distribution 399 

what  included  in  the  term 28 

J. 
JOINT-STOCK  ASSOCIATIONS: 

stock  of,  is  taxable 43 

JOINT-STOCK  ASSOCIATIONS  AND  CORPORATIONS: 

difference    between 266 

JOINT  TENANCY: 

when  not  created  as  between  partners 43 

JURISDICTION  OF  THE  SURROGATE.     (See  Surrogate.) 

X. 

KINGS  COUNTY: 

appraisers  in  ( §  229,  Tax  Law) 234 

salary  of 235 

stenographers  in 235 

salary  of 236 

surrogate's  assistant,  clerks,  etc.  (§  234,  Tax  Law) 367 

salaries  of 367 

L. 
LEASEHOLD  INTERESTS: 

are  taxable,  were  prior  to  1903 48 

LEGACY: 

given  for  a  home 59 

in  lieu  of  dower  is  not  a  debt  of  the  estate 55 

in  lieu  of  dower,  is  taxable  if  accepted 44 

in  payment  of  a  debt  is  taxable 44,  320 

is  a  naked  right  until  reduced  to  possession 64 

paid  from  property  not  belonging  to  decedent  is  not  taxable.  .  63 

renunciation  of,  tax  upon 30 

shown  to  be  imposed  with  a  trust,  when  taxable 46 

taxability  of,  where  legatee  dies  before  receiving  it 134 

to  a  corporation  not  in  existence 63 

to  brother  and  chargeable  on  land 61 

to  executors  (§  226,  Tax  Law) 216 

to  executors  subject  to  a  trust,  when  not  taxable 58 

to  nonresident,  is  taxable 149 

transfer  of  title  to  in  remainder,  time  of 26 

upon  devolution  of  title,  is  taxable 26 

when   tax   attaches  to 25 


GENEBAL   INDEX.  483 

LEGATEE:  page, 

debts  due  from 40 

dying  before  conversion  takes  place,  effect  of 29 

dying  before  receiving  legacy 41 

judgment  against,  is  taxable 39 

note  of,  when  taxable j?9 

order  modified,  when  not  notified  of  surrogate's  determination.  358 

renunciation  of  legacy  by 30 

residence  of,  does  not  affect  taxability 30 

LEGISLATURE: 

power  of,  over  taxation 3 

can  tax  all  property  transferred  by  will 3 

LIABILITY  OF  CERTAIN  CORPORATIONS  (§  227,  Tax  Law)...  210 

amendments  affecting  219,  220,  22* 

consent  of  Comptroller,  how  obtained '. 222 

corporations  transfer  at  their  peril,  when 223 

former  acts  relating  to 224 

former  section   228   of  the  Taw   Law   referred   to  this    sub- 
ject    219,  222 

obligation  to  give  the  notice  rests  upon  the  depositary 223 

provisions  are  generally  complied  with 222 

to  pay  tax  ( §  227,  Tax  Law  —  former  §  228) 219 

LIABILITY  TO  TAX: 

whole  estate  passing  determines 13 

includes  real  property  since  1903 15 

LIEN  OF  TAX: 

remains  until  paid  ( §  224,  Tax  Law) 198,  200 

exception  as  to  lien  on  real  estate  (§  282,  Tax  Law) 202 

LIMITATIONS: 

five  hundred  dollars,  transfers  of  estates  under,  are  not  taxable.     34 
in  section  221,  Tax  Law,  refer  to  aggregate  property  passing  to 

"  taxable  persons  "  or  corporations 169 

respecting  application  for  refund  (§  225,  Tax  Law) 211 

section  282  of  the  Tax  Law 202 

statute  of,  does  not  apply  to  transfer  tax  proceedings 202 

exception  as  to  real  estate 202 

ten  thosuand  dollars,  aggregate  estate  real  and  personal  must 
equal,  when  all  or  part  is  transferred  to  one  per  cent,  class. .    169 

to  one  per  cent,  class  (§  221,  Tax  Law) 164,  167 

to  five  per  cent,  class  ( §  220,  Tax  Law) 168 

two  nor  six- year  limitations  not  applicable  to  payment  of  tax.   201 
when  statute  of,  may  be  retroactive 18 

LINEAL  DESCENDANTS: 

children  of  adopted  child  not  included  in  the  term 170 

means  direct  descendants 177 


484  GENERAL   INDEX. 

M. 
MASSES:  page. 

bequest  for,  when  taxable 40 

MEANING  OF  CERTAIN  WORDS  AND  PHRASES: 

"  deed  " 27 

"  estate  " 27 

"  I  forgive  one-half,"  etc.,  construed  as  a  valid  gift  to  that 

extent  of  a  debt  owing  to  decedent 47 

"  intestate  laws," —  what  the  term  covers 28 

"  transfer  " 23 

"  vested  "  is  equivalent  to  the  word  "  accrued  " 84 

•'  when  persons  become  beneficially  entitled,"  etc 26 

METHOD: 

of  computing  life  estates  and  remainders 259 

MISSIONARY  CORPORATION: 

exemption  of  ( §  221,  Tax  Law) 165 

when  first  exempted 166 

MODIFICATION  OF  ORDER: 

cannot  modify  decree  because  appraisal  was  too  high 351 

Comptroller  may  apply  for  reappraisal,  or  appeal 360 

conclusiveness   of   appraisal 359 

correction  of  order  refused 387 

correction,  when  time  to  appeal  has  expired 359 

decree  not  opened  to  correct  an  error  of  law 355 

decree  vacated  when  statute  is  unconstitutional 353 

finality  of   surrogate's  determination 354 

improper  to  raise  value  on  reappraisal 359 

need  not  direct  Comptroller  to  refund 214 

reappraisal,  provision  applies  only  to  errors  of  fact 358 

rehearing,  when  refused 358 

Supreme  Court  cannot  vacate  order  for  reappraisal 360 

will  not  review  surrogate's  discretion,  when 361 

surrogate  cannot  modify  order  on  ex  parte  application 387 

surrogate's  power  to  decree  previous  order  erroneous 355 

under  section  2481  of  the  Code,  subdivision  6 355 

surrogate's  power  to  modify 35 1 

when  not  entitled  to  a  reappraisal 358 

when  order  will  be  set  aside 360 

when  surrogate  can  modify  his  decree 354 

when  surrogate  cannot  grant  relief  as  to  debts 356 

when  surrogate  may  vacate  his  order 358 

when  legatee  not  notified  of  surrogate's  determination 356 

when  time  to  appeal  has  expired 353 

(See  Appeal;  Appraisal;  Surrogate.) 


GENERAL   INDEX.  485 

MONEY:  PAGE- 
certificate  of  deposits  of,  when  taxable  where  held  by  a  nonresi- 
dent decedent   without   this   State 147.  148 

deposit  of,  by  a  resident  to  pay  debt  due  a  nonresident,  when 

taxable 151 

loaned,  is  not  an  advancement 48 

of  nonresident  transitorily  here 150 

MONROE  COUNTY: 

appraisers  in  ( §  229,  Tax  Law) 234 

salary  of 2  ° 

necessary  expenses  of 368 

two  transfer  tax  clerks  in  (§  234,  Tax  Law) 368 

salaries  of 368 

MUTUALLY  ACKNOWLEDGED  RELATION: 

amendment  of  1898  requiring  relation  to  commence  at  or  be- 
fore child's  fifteenth  birthday  (§  221,  Tax  Law) 164 

amendment  of  1905  requiring  that  both  parents  of  the  child 

must  be  deceased  when  the  relationship  commenced 165 

beneficiary  is  a  competent  witness  to  show  relationship 1/6 

burden  of  proof  to  establish  is  on  person  claiming 176 

can  be  established  between  strangers  in  blood 173 

facts  establishing * ' l 

failure  to  show "° 

living  as  one  family  does  not  establish 177 

of  parent  and  child  ( §  221,  Tax  Law) 164 

prior  to  1898  could  be  created  in  favor  of  adults 165,  171 

proof  of 17(i 

provision  was  not  limited  to  illegitimate  children 174 

relationship  must  be  mutual 172 

stepchildren  not  necessarily  included 176 

when  first  included  in  the  one  per  cent,  class 164 

when  relationship  is  established 175 

N. 
NATURE  OF  THE  TAX: 

special,  and  not  general 16 

NATIONAL  BANKS: 

stock  of,  owned  by  nonresident  is  taxable 155 

NEW  YORK  COUNTY: 

appraisers  in  (§  229,  Tax  Law) 234 

office  expenses  of "'c 

salaries  of - — ":> 


486  GENERAL   INDEX. 

NEW  YORK  COUNTY—  Continued:  page. 

stenographers   in    235 

salaries  of 236 

surrogate's  assistants,  clerks,  etc.  ( §  234,  Tax  Law) 367 

salaries  of 367 

NONRESIDENTS: 

constitutionality  of  the  act 120 

courts  will  not  apply  the  maxim  mobila  personam  sequuntur. .    120 
distinction  between  bonds  and  stocks  of  New  York  corpora- 
tions     125 

executor  is  not  obliged  to  testify  as  to  property  of  decedent 

without  this  State 149 

history  of  the  law  affecting 121 

jurisdiction  of  the  surrogate  ( §  228,  Tax  Law) 124 

ancillary  letters  not  necessary  to  confer 124,  163 

effect  of  Act  of   1892  as  to  property  not  removed  prior 

thereto 123 

not  lost  by  removal  of  the  property  from  the  county 189 

over  stock  of  domestic  corporations 232 

real  estate  necessary  to  confer,  prior  to  May  1,  1892 123 

liability  to  tax  at  decedent's  domicile  does  not  affect  the  taxa- 
bility here 191 

memoranda  of  decisions  as  to  bonds  and  stocks 152-156 

Nontaxable  Transfers  By: 

bonds  of  New  York  corporations  without  this  State  at  dece- 
dent's death 125,  128,  154 

bonds  pledged  as  collateral 153 

bonds  secured  by  mortgage  on  real  property  in  this  State,  when 

not  taxable   153 

certificate  of  stock  of  foreign  corporations 128 

debt  on  an  open  account 151 

life  insurance  policies 149 

money  transitorily  here 150 

where  legatee  dies  before  receiving  legacy 133 

payment  of  tax;  foreign  executor  to  pay  (§  227,  Tax  Law)..   219 
when  payable  to  county  treasurer  (§  222,  Tax  Law).    185,  188 

when  payable  to  the  State  Comptroller 185,  188 

proceedings  and  practice 162 

property  of ;  when  taxable  ( §  220,  Tax  Law) 34 

consent  of  State  Comptroller  to  transfer,  how  obtained. . .    162 
forms;  application  for  consent  to  transfer,  affidavit,  etc..   434 


GENERAL   INDEX.  487 

NONRESIDENTS  —  Continued :  page. 

recognition  of  laws  of  other  States  respecting  distribution.  . .  .   157 

residence  of  decedent 158 

will,  not  conclusive  as  to 161 

of  legatee  is  immaterial  as  affecting  liability  to  taxation. .   149 
right  of  executor  to  apply  property  in  payment  of  legacies.  . .  .   156 

statute  affecting  transfers  by  (§  220,  Tax  Law) 34 

when  debt  due,  was  held  not  taxable 151 

Taxable  Transfers  By: 

bonds    and    money    left    with    decedent's    attorney    in    this 

State 150,  152 

bonds    of    New    York    corporations,    if    here    at    decedent's 

death 128,  153 

bonds  pledged,  taxable  if  redeemed 154 

both  registered  and  coupon  bonds  of  foreign  corporations  are 

taxable  if  here 129,  153 

certificate  of  deposit 47,  147 

debts  owing  by  a  resident,  to  a  nonresident  decedent 142 

deposit  with  brokers  to  protect  a  margin 48 

legacy  to  legatee  who  dies  before  receiving  it,  when  taxable 134 

loans  made  by  a  partner  to  his  firm 151 

money  deposited  by  a  creditor  to  pay  a  debt  due  a  nonresident, 

when  taxable 151 

money  deposited  in  this  State 131 

money  in  savings  banks 150 

money  deposited  with  trust  company 148 

notes  owned  by  decedent,  within  this  State 146 

United  States  bonds,  since   1898 152 

seat  in  New  York  Stock  Exchange 138 

stocks  of  New  York  corporations,  wherever  kept 125 

the  Act  of  1887  applied  to  the  property  of  an  intestate 122 

when  first  taxable 34 

where  community  law  prevails 157 

(See    Appraisal;    Appraiser;    Surrogate;    Transfers  —  Nontaxable 

and  Taxable  Transfers;  Transfer  Tax.) 
NONTAXABLE  TRANSFERS  —  RESIDENT  DECEDENTS.     (See 

Transfers.) 
NOTES  DIRECTED  TO  BE  CANCELED: 

appraisal  of 267 

NOTES  OVERDUE: 

when  treated  as  valid  obligations,  are  taxable 164 


488  GENERAL   INDEX. 

NOTICE:  page- 

of  appraisal 249 

effect  of  failure  to  give 249 

of  assessment  and  determination 327 

presumption  of 329 

to  be  given  State  Comptroller  by  safe-deposit  companies  and 

others  (§  227,  Tax  Law) 219 

penalty  for  failure  to  give 221 

0. 
OMITTED  SECTIONS  AND  PROVISIONS: 

by  the  Act  of  1905: 

former  section  226  relating  to  "  deferred  payments  " 21 

197,  217 
provision    in   former   section   230    relating   to   appraising 
transfers  depending  on  a  contingency  immediately,  "  or 

as  soon  thereafter  as  practicable" 270,  271 

provision    of    former    section    230    taxing    estates    which 

vested  prior  to  June  30,  1885 271 

provision  in  former  section  235  relating  to  "  compromise 

of  tax  " 378 

word  "  penalty  "  omitted  from  title  of  section  223 197 

words  "  heretofore  or  hereafter  "  omitted  from  section  221 
specifically  exempting  bishops  and  certain  corporations.   165 
by  chapter  88,  Laws  of  1898: 

from  former  section  242  the  words  "  over  which  this  State 
has  any  jurisdiction  for  the  purpose  of  taxation  ".    129,  389 
ONE  PER  CENT.  CLASS: 

section  221  of  the  Tax  Law 164 

who  included  in 167 

ONEIDA  COUNTY: 

appraisers  in  ( §  229,  Tax  Law) 234 

salary  of 235 

not  more  than  two  transfer  tax  clerks  in  (§  234,  Tax  Law) . . .   369 

aggregate  salaries  of 369 

ONONDAGA  COUNTY: 

appraisers   in    ( §  229,  Tax  Law) 234 

salary  of 235 

transfer  tax  clerk  in  ( §  234,  Tax  Law) 368 

salary  of 368 


GENERAL   INDEX.  489 

ORANGE  COUNTY:  page. 

appraiser  in  (§  229,  Tax  Law) 234 

salary  of ^35 

ORDERS: 

directing  payment  in  district  attorney  proceedings 375 

interest  of  beneficiaries  under 331 

of  exemption,  ex  parte  application  for 332 

the  order  appealed  from 341 

vacating,  newly-discovered  evidence 331 

when  not  entered  by  consent 330 

when  order  becomes  final  and  conclusive 344 

(See  Appeals;  Modification  of  Order;  Surrogate.) 

P. 

PAYMENT  OF  TAX: 

Act  of  1885  relating  to I86 

Act  of  1892  relating  to 186 

in  foreign  State  does  not  affect  the  taxability  here 191 

no  excuse,  that  estate  has  been  distributed 189 

not  from  estate,  by  words  of  the  will 192 

on  legacy  in  trust,  remainder  over 190 

on  remainder  under  Act  of  1887 191 

on  trust  estate 191 

proceedings  to  compel;  not  to  be  instituted  until  after  eighteen 

months  from  accrual 370 

sale  of  what  property  to  pay 20:> 

to  county  treasurers,  in  counties  where  appraiser  i9  not  sal- 
aried     186>  m 

to   State   Comptroller,   in   counties   where   appraiser   is    sala- 
ried    *86>  188 

two  nor  six-year  limitation,  do  not  apply 201 

under  power  of  appointment,  when  power  is  exercised 96 

when  will  be  paid  from  donee's  residuary  estate 110 

voluntary  payment,  what  is I89 

when  due  and  payable  (§  222,  Tax  Law) 185,  186 

exception 18,) 

when   fair  market   value  of  transfer  cannot   be  established; 

when  to  be  paid I8" 

when  not  voluntary 1**0 

(See  District  Attorney  Proceedings;  Transfer  Tax.) 


490  GENERAL   INDEX. 

PENALTY:  page. 

liability  of  banks  and  certain  corporations  to  incur   (J  227, 

Tax  Law) 219,  221 

PERSONAL  PROPERTY: 

courts  apply  maxim  mobila  personam  sequuntur,  when  with- 
out this  State  as  to  property  of  residents 120 

defined  by  Statutory  Construction  Law 37 

of  nonresident  decedents,  when  first  taxable 34 

of  nonresident  not  removed  until  after  Act  of  1892 123 

of  resident,  is  taxable  wherever  situated 38 

when  first  taxable,  passing  to  one  per  cent,  class 34,  165 

POWER  OF  APPOINTMENT: 

accrual  of  tax  on  transfer  subject  to 187 

appointee  can  elect,  when 96 

attempt  to  exercise,  when  not  a  taxable  transfer 107,  113 

character  of  property  (real  or  personal)  at  time  of  exercise  of, 

determined  taxability 93,  114 

decisions  affecting  transfers  by 112 

decisions  prior  to  amendment  of  1897 117 

defined  under  Real  Property  Law 89 

distinction  between  powers  created  by  will 106 

effect  of  conferring  a  general  power 89 

equitable  conversion,  could  not  be  invoked  when  power  was 

not  exercised Ill 

erroneous  payment  on  remainder  subject  to,  not  a  payment 

made  "  in  advance  " 99 

execution  of  the  power  gives  property  to  appointee 90,  97 

exercise  of,  applies  equally  to  real  or  personal  property 90 

exercise  of,  by  donee,  makes  a  gift 89,  113 

exercise  of,  over  funds  without  this  State 108 

grantee  with  power  to  dispose,  when  entitled  to  an  absolute 

fee 112 

no  distinction  as  to  method  or  date  of  creation 95,  113 

object  and  purpose  of  the  statute 90 

omission,  or  failure  to  exercise 116 

payment  of  loan  by  exercise  of 115 

powers  created  by  deed 94 

powers  created  by  will 91 

provision  not  repealed  by  chapter  76,  Laws   1899,  amending 

section  230 115 


GENERAL   INDEX.  491 

POWER  OF  APPOINTMENT  — Continued:  page. 

relationship  of  donee  and  appointee  determines  rate 7,  114 

remaindermen  not  bound  by  act  of  life  tenant  who  fails  to 

exercise  power 109 

subdivision  5,  section  220  is  constitutional 4,  112 

when  first  became  a  law 35 

surrogate  of  county  where  donee  resided  has  jurisdiction 115 

tax  accrues  when  power  is  exercised 97 

tax  upon,  is  a  succession  tax 93,  113 

vested  remainder  created  by  exercise  of,  when  taxable 115 

when  deemed  to  have  been  exercised 101 

when  exercise  of,  is  a  mere  form 113 

when  exercise  of,  is  in  contravention  of  statute  of  perpetui- 
ties   116 

when  tax  on,  to  be  paid  from  donee's  residuary  estate 110 

where  remainder  is  given  upon  failure  to  exercise  power 106 

where  remainder  is  given  subject  to  power 106 

will,  disposing  of  all  of  testator's  property  operates  as  an  exer- 
cise of 113 

who  to  determine  tax  upon  the  exercise  of 115 

(See  Appraisal;  Future  and  Limited  Estates.) 

POSSESSION: 

legacy  is  only  a  naked  right  until  reduced  to 64 

PROCEDURE: 

statute  in  force  when  proceedings  are  instituted  governs 16 

PROFITS: 

when  taxable 48 

PROMISSORY  NOTE: 

payable  to  husband  and  wife 53 

PROPERTY: 

defined  ( §  242,  Tax  Law) 389 

laws  of  other  States  recognized  as  to  distribution  of,  in  in- 
testacy   157 

not  limited  to  definition  under  General  Tax  Law 36 

nonresident   executor    not   obliged  to  testify   as  to  property 

without    this    State 149 

provision  of  the  Code  —  estates  of  married  women 402 

statute  of  descent 402 

statute  of  distribution 399 

transfer  of  decedent's  property  only,  is  taxable 63 


4!)2  GENERAL    INDEX. 

PROPERTY  —  Continued :  PAGE. 

transferred  by  reason  of  contract  obligations,  not  taxable 65 

when  right  to,  accrued  under  a  certain  trust  deed 84 

where  community  laws  prevail 157 

(See  Appraisal;  Nonresident;  Power  of  Appointment;  Transfers.) 

PROPERTY  TAX: 

when  imposed  by  reason  of  ownership,  tax  is  a 2 

Q. 

QUEENS  COUNTY: 

appraisers  in  (§  229,  Tax  Law) 234 

salary  of 235 

transfer  tax  clerk  in  ( §  234,  Tax  Law) 368 

salary  of 368 

R. 

RATE  OF  TAX: 

contingent   estates   and   remainders,   at   highest   rate   possible 

(§  230,  Tax  Law) 244 

return  of,  where  property  actually  passes  to  one  per  cent. 

class 244 

under  appointment,  relationship  of  appointee  to  donee  deter- 
mines     114 

transfers  to  collaterals  ( §  220,  Tax  Law) 35 

transfers  to  lineals  and  others  (§  221,  Tax  Law) 165 

REAL  PROPERTY: 

to  be  included  in  aggregate  estate  transferred  to  taxable  per- 
sons       15 

when  first  taxable  to  one  per  cent,  class 34,  165 

without  this  State  is  not  taxable 62 

REAPPRAISAL: 

application  to  justice  of  the  Supreme  Court  for   (§   232,  Tax 

Law)   337 

appraiser   to  be   appointed  by   the   justice;    compensation 

of;  powers  of;  report  of,  where  filed 337 

determination  of  justice  supersedes  former  determination 
of  the  surrogate;  where  to  be  filed;  certified  copy  to  be 

sent  to  Surrogate's  Court  338 

within  what  time  application  for,  is  to  be  made;  grounds 

for 337 

Comptroller  may  apply  for,  or  appeal 360 


GENERAL    INDEX.  493 

REAPPRAISAL  —  Continued :  page. 

improper  to  raise  values  on 359 

provision  applies  only  to  errors  of  fact 358 

rehearing,  when   refused 358 

Supreme  Court  cannot  vacate  order  for 360 

will  not  review  surrogate's  discretion 361 

when  not  entitled  to 358 

RECEIPTS: 

by  whom  given   ( §  222,  Tax  Law) 186 

certificate  as  to   payment   of  tax  on  real   estate    ( §   236,  Tax 

Law )   380 

countersigned  by  whom  ( §  236,  Tax  Law ) 379 

executor  must  produce,  on  final  settlement 379 

fee  for  in  certain  cases 380 

recording  certificate  in  county  clerk's  office 380 

REFUND: 

after  time  to  appeal  has  expired 211 

application  for;  two-year  limitation    211 

former  statutes  respecting 207,  208 

interest  will  attach  to.  when 213 

of  tax  erroneously  paid  ( §  225,  Tax  Law) 207 

order  need  not  direct  Comptroller  to 214 

power  of  surrogate  to  order 209 

provision  of  the  statute  is  exclusive 209 

right  to,  is  a  privilege,  not  a  vested  right 215 

where  debts  are  subsequently  discovered 210 

within  what  time  application  to  be  made  for  (§  225,  Tax  Law).  207 

RELIGIOUS  CORPORATIONS: 

exemptions  of  ( §  221,  Tax  Law) 165 

provision  is  not  retroactive  since  June  1,  1905 165 

refers  to  domestic  corporations  only 181,  182 

when   first   exempted 165 

REMAINDERS  OR  REVERSIONS: 

accrual  of  tax  on 188 

subject  to  appointment,  not  taxable  until  power  is  exercised.  .  97 

when  life  tenant  can  use  principal 188 

when  not  taxable 66 

(See  Future  and  Limited  Estates.) 

REMISSION  OF  INTEREST: 

amendments  respecting 192,  193 

application  for 1-H 


494  GENERAL   INDEX. 

REMISSION  OF  INTEREST  — Continued: 

application  for  —  Continued:  page. 

to  whom  made 194 

when  denied 194 

cannot  be  remitted  altogether 194 

grounds  for  (§  223,  Tax  Law) 192 

when  allowed 192 

RENSSELAER  COUNTY: 

appraiser  in  ( §  229,  Tax  Law) 234 

salary  of 235 

REPORT: 

of  appraiser  ( §  230,  Tax  Law) 241 

must  be  in  duplicate 256 

what  should  show , 256 

where  to  be  filed 245 

of  appraiser  appointed  by  Supreme  Court  (§  232,  Tax  Law) . .  237 

compensation  of 237 

determination  of  justice  supersedes  that  of  surrogate....  338 

when  to  be  appointed 337 

where  determination  to  be  filed 338 

of  county  clerk  (§  239,  Tax  Law) 384 

of  county  treasurer  ( §  240,  Tax  Law) 385 

of  surrogate  ( §  239,  Tax  Law) 384 

former  acts  relating  to 385 

of  State  Comptroller  (§  240a,  Tax  Law) 387 

former  acts  relating  to 387 

payment  of  tax  to  State  Treasurer  by 387 

(See  Appraisal;  Appraiser;  Reappraisal;  Surrogate.) 
RESIDENCE  OF  DECEDENT: 

appraiser  to  take  proof  of 158 

will  not  conclusive  as  to 161 

RETROACTIVE  STATUTES: 

amendatory  statute  is  not,  unless  intent  is  clear 18 

are  not,  unless  stated  to  be 17,     18 

provision  exempting  bishop  and  religious  corporations  was.  ...  18 

is  not  retroactive  by  section  221,  Act  of  1905 164 

repeal  of  a  statute  of  limitation,  may  be 18 

RENUNCIATION  OF  LEGACY: 

accrual  of  tax  upon 188 

right  to  renounce,  is  not  denied  by  statute 25 

tax  is  then  upon  the  ultimate  devolution  of  the  property 30 


GENEBAL   INDEX.  495 

RICHMOND  COUNTY:  page. 

appraiser  in  (§  229,  Tax  Law) 234 

salary  of  236 

RIGHT  TO  TAKE  PROPERTY: 

by  descent  or  devise,  is  a  privilege 2 

S. 
SAFE-DEPOSIT  COMPANY: 

consent  of  Comptroller  to  transfer,  how  obtained 222 

corporation  transfers  at  their  peril,  when 223 

obligation  to  give  notice  rests  on 223 

penalty,  how  incurred 221 

property  of  a  decedent,  held  by 219,  220,  221 

when  liable  to  pay  tax  ( §  227,  Tax  Law) 219 

SAVINGS  BANK  DEPOSITS: 

in  name  of  mother  and  daughter 52 

in  trust  for  another 49 

joint  accounts,  husband  and  wife 50 

when  either  or  survivor  may  draw 51 

SECTIONS  OF  THE  TRANSFER  TAX  LAW.       See  Index  to 509 

SECURITIES: 

appraisal  of  ( §  230,  Tax  Law) 263 

SHARE  IN  UNDISTRIBUTED  ESTATE: 

is   not   taxable 58 

"SPECIFICALLY  EXEMPTED."     (See  Exemptions.) 

STATE: 

can  tax  privileges 2 

discriminate  between  relatives 2 

STATE  COMPTROLLER: 

appointment    of    appraisers,    stenographers,    etc.,    by    (§    229, 

Tax  Law) 234 

appointment  of  surrogate's  assistants  in  certain  counties  by 

( §  234,  Tax  Law) 367 

application  by,  for  appraisal,  stated  on  information  and  belief..   247 

books  and  forms  to  be  furnished  (§  238,  Tax  Law) 383 

can  appeal  from  order  fixing  tax  (§  232,  Tax  Law) 337,  338 

can    apply    to    Supreme   Court    for   reappraisal    (§    232,   Tax 

Law).  .  .   337,  338 

can  institute  proceedings  to  determine  tax  (§  230,  Tax  Law) . .  241 
certificate  by,  showing  tax  paid  on   real   estate    ( §   236,  Tax 

Law) 380 

composition  agreement  by  ( §  233,  Tax  Law) 364 


496  GENERAL   INDEX. 

STATE  COMPTROLLER  —  Continued :  page. 

consent  of,  to  transfer  stocks,  etc.,  under  section  227  of  the 

Tax  Law,  how  obtained 222 

is  to  furnish  books,  blanks,  etc.,  to  transfer  tax  appraisers 

(§  238,  Tax  Law) 383 

may  retain  counsel  (§  235,  Tax  Law) 370 

must  be  cited  upon  application  for  ancillary  letters 228 

receipts  to  be  given,  or  countersigned  by  (§  236,  Tax  Law) ....  379 

report  to  be  made  by  (§  240a,  Tax  Law) 387 

right  to  an  appraisal,  is  an  interested  person 241 

tax  paid  to,  direct,  in  certain  counties 186 

when  first  authorized  to  institute  proceedings 241 

STATUTES: 

are  not  retroactive  unless  intent  is  clear 18 

literal  construction  of,  when  not  intended 71 

of  descent 402 

of  distribution 399 

estates  of  married  women 402 

one  governing  procedure 16 

provisions  of  section  222  not  repealed  by  implication 191 

STATUTE  OF  LIMITATIONS: 

when  repeal  of,  may  be  retroactive 18 

(See  Limitations.) 
STOCK  EXCHANGE: 

seat  or  membership  in,  is  taxable 45 

when  owned  by  a  nonresident 138 

STOCKS: 

appraisal  of 262 

inactive  stock 267 

stock   of  joint-stock   association 266 

unlisted  stocks 265 

where  there  is  no  market  value 266 

memoranda  of  decisions  affecting 152-156 

of  domestic  corporations  are  appraised  at  their  market  value 

regardless  of  where  their  capital  is  employed 264 

of  domestic  corporations  owned  by  nonresident,  subject  to  a 

life  estate 155 

of  foreign  corporation  owned  by  resident 43 

when  owned  by  nonresident 155 

of  joint-stock  associations 154 

of  national  banks 155 

of  New  York  corporations  owned  by  a  nonresident 155 


GENERAL    INDEX.  497 

STOCKS  —  Continued :  page. 

pledged,  are  not  taxable 60 

are  taxable   if  redeemed 46 

standing  in  name  of  third  person,  are  taxable 154 

SUCCESSION: 

tax  is  upon  the  right  of 1,  2,  93,  95,  120,  121 

SUFFOLK  COUNTY: 

appraiser  in  ( §  229,  Tax  Law) 234 

salary  of  235 

transfer  tax  clerk  in  ( §  234,  Tax  Law) 369 

salary  of  369 

SUPREME  COURT  AT  SPECIAL  TERM  WILL   NOT  REVIEW 
SURROGATE'S  DISCRETION: 
in  appointing  an  appraiser  upon  the  estate  of  a  nonresident 

decedent 361 

SUPERINTENDENT  OF  INSURANCE: 

appraisal    of   future    and    contingent    estates,    annuities,    etc., 

by   ( §  231,  Tax  Law) 327 

surrogate  is  to  apply  for 327 

when  necessary   .a. 329 

SURPLUS  FUND: 

in  partition  suit,  when  taxable 40 

SURROGATE: 

acts  first  as  taxing  officer 229,  328 

appeal  lies  to,  as  a  judicial  officer 328 

appointment   of   assistants,   and   clerks   in   certain   surrogates' 

offices  by  (§  234,  Tax  Law) 367 

can  construe  will  on  appeal  in  transfer  tax  proceedings 341 

can  determine  all  questions  relating  to  the  act 229 

can  issue  a  commission 230 

what  moving  papers  for,  must  show 230 

cannot  modify  decree  where  property  sold   for  less  than  ap- 
praised   value 351 

cannot  modify  order  on  ex  parte  application  for 387 

can  send  report  back  for  correction 331 

J/    can   vacate   order,   when 358 

•S        finality  of  determination  of 354 

is  to  apply  to  Superintendent  of  Insurance 327 

is  to  forward  copies  of  all  orders  to  State  Comptroller. .  .   327,  330 

is  to  fix  cash  value  of  all  estates 326 

from  the  report  of  appraiser,  etc.  (§  231,  Tax  Law) 326 


498  GENERAL   INDEX. 

SURROGATE  —  Continued :  page. 

is  to  give  notice  of  his  determination 329 

presumption  of 329 

jurisdiction  of  the  surrogate  (§  228,  Tax  Law) 227 

amendments  affecting 227,  228 

ancillary  letters  unnecessary  to  confer,  in  nonresident  cases.  232 

as  to  property  of  nonresidents 124 

consent  of  foreign  executor  necessary  before  ancillary  let- 
ters can  issue 232 

corresponding  sections  of  former  acts  relating  to 234 

courts  have  no  general  powers  of 16 

distribution  of  estate  don't  affect 233 

failure  to  give  notice  don't  affect  appeal 343 

original  and  exclusive 229 

over  stock  in  domestic  corporations 232 

surrogate  where  donee  of  power  resided,  has 115,  231 

what  irregularity  does  not  affect 233 

when  without;   incident 231 

where  nonresident's  estate  has  been  distributed 189,  233 

where  decedent's  residence  is  in  dispute 159 

where    nonresident    leaves    property    in    more    than    one 

county 233 

where  resident  leaves  property  in  several  counties 248 

may  construe  will 230 

may  order  further  appraisal 262 

may  return  report  to  appraiser 260 

on  appeal,  may  receive  additional  evidence,  and  consider  new 

questions    342 

or  take  proof  that  transfer  was  made  in  contemplation 

of  death  of  the  donor 343 

order;    interests   of  beneficiaries   under 331 

power  to  modify 351 

when  not   entered   by  consent 330 

vacating,  newly -discovered  evidence 331 

power  of ;  to  correct  clerical  errors 332 

to  decree  previous  order  erroneous 355 

to  order  a  refund 209 

under  subdivision  6,  section  2481  of  the  Code 355 

reports  of,  when  to  be  made  (§  239,  Tax  Law) 384 

should  vacate  order  when  report  is  defective 260 


GENERAL    INDEX.  49i> 

SURROGATE  —  Continued :  page. 

taxing  debts,  etc.,  erroneously  allowed  (§  225,  Tax  Law).  209,  215 

to  fix  the  cash  value  of  all  estates;  the  general  subject 275 

from  the  report  of  the  appraiser  and  other  proof   (§  231, 

Tax  Law) 320 

value  of  estates  and  amount  of  tax,  how  determined  by  328 

when  can  modify  decree 354 

when  cannot  grant  relief 356 

when  to  appoint  a  guardian  for  an  infant  or  incompetent ....  327 
(See  Appeals;  Modification  of  Orders;  Reappraisal.) 

T. 

TABLE  OF  CASES  CITED 447 

TAXABLE  BEQUEST: 

law  phrases  unnecessary  to  create 4ft 

TAXABLE  PERSONS: 

section  221,  Tax  Law 164- 

who  included  in  the  term 17S- 

TAX  PAID  IN  ANOTHER  STATE: 

does  not  relieve  property  here  from  taxation 322- 

is  not  to  be  deducted 322 

TAXABLE  TRANSFERS.     (See  Transfers.) 
TRACT  SOCIETIES: 

exemption  of  ( §  221,  Tax  Law) 164 

when   first   exempted i 16ft 

TRANSFERS: 

aggregate  property,  determines  taxability  of  each  transfer...    169 

by  exercise  of  power  of  appointment 90 

decisions  affecting  *« 

not  taxable  until  power  is  exercised 116 

when  first  taxable 3i 

by  trust  deed,  when  not  a  gift  inter  vivos 77 

consent  of  Comptroller  to,  how  obtained 222 

defined   (§  242,  Tax  Law) 389 

by   the  courts 23,  87,  393 

there  is  no  transfer  by  will,  unless  legacy  is  accepted  393 

in  contemplation  of  death /-> 

when  first  taxable '"' 

meaning  of  the  word 23,     8.* 

not  made  in  contemplation  of  death '4 

not  made  to  take  effect  at  or  after  donor's  death 82 


500  GENERAL   INDEX. 

TRANSFERS  —  Continued :  page. 

of  title,  time  of 26 

subject  to  a  contingent  incumbrance 285 

tax  is  due  and  payable  upon  ( §  232,  Tax  Law) 185 

to  take  effect  at  or  after  donor's  death 77,  80 

when   first  taxable 35 

when     person    becomes     "  beneficially     entitled,"     when     first 

taxable 35 

when  the  transfer  takes  place 24 

Nontaxable  Transfers  : 

accrued  rights  prior  to  the  Tax  Law 57 

advancements   66 

articles  mentioned  in  section  2713  of  the  Code 61 

bequest  for  a  burial  plot 58 

bequest  with  precatory  words  59 

bonds  kept  by  nonresident  at  his  domicile 125 

chose  in  action,  when  taxable 66 

curtesy 68 

estate  vested  prior  to  Transfer  Tax  Law 58 

exercise  of  appointment  over  funds  without  this  State 108 

fund,  to  pay  annuity  created  by  a  trust  agreement 62 

gifts,  where  will  contains  no  present  words  of  gift 86 

gift  upon  agreement  to  care  for  donor  for  life 87 

increase,   accruing  after   decedent's   death 58 

interest  or  share  in  an  undivided  estate 58 

legacy  given  in  consideration  of  a  home  (Act  of  1887) 59 

legacy  not  reduced  to  possession 64 

legacy  paid  from  property  not  belonging  to  decedent 63 

legacy  to  a  brother  chargeable  on  land 61 

legacy  to  a  corporation  named  but  not  in  existence 63 

legacy  to  executor  subject  to  a  trust 58 

life-insurance  policies    149 

money  of  nonresident,  transitorily  here 150 

proceeds  of  gratuity  fund  of  New  York  Produce  Exchange.  ...  61 

property  transferred  by  antenuptial  agreement 64 

property  transferred  by  contract  obligations 65 

real  property  without  the  State 62 

remainders  and  reversions  under  the  earlier  law 66 

stocks  pledged  as  collateral    60 

United   States   bonds   between  May    1,    1892,   and   March    21, 

1898 60,  128 

widow's  dower  is  not  taxable 67 


I  / 


GENERAL    INDEX.  501 

TRANSFERS  —  Continued : 
Taxable  Transfers:                                                                          page- 
annuity  to  executor  and  trustee 4- 

40 
bequest  for  masses    

bequest  to  the  United   States 43 

bond  and  mortgage  held  by  husband  and  wife  jointly 54 

both  registered  and  coupon  bonds  of  a  nonresident  if  here  at 

1^9 
his  death   

by  exercise  of  a  power  of  appointment 

by  trust  deed  

certificate  of  deposit    47>  14/ 

debts  due  from  a  legatee 4t) 

debts  owing  by  a  resident  to  a  nonresident  decedent 47,  142 

deposit  to  protect  a  margin 48 

firm  name,  is  a  part  of  the  good  will 41 

fund  over  which  grantor  reserves  a  power 49 

gifts  inter  vivos  and  causa  mortis '  ° 

distinction  between    '  ° 

gifts  upon  conditions  or  agreement 80 

good  will  of   business 

"  I  forgive  one-half,"  etc.,  amounts  to 4' 

in  contemplation  of  death  of  donor 69,     73 

v  .  42 

insurance  policies    

interest  in  fund  in  partition  suit 40 

judgment   against   heir   or   legatee 39 

land  subject  to  a  mortgage,  equity  only  taxable 39 

leasehold   interests   in   land;    were   prior  to    1903 48 

legacy  imposed  with  a  trust 

legacy  in  payment  of  a  debt 44>  320 

legacy  in  lieu  of  dower  is  not  a  debt  of  the  estate 5"> 

legacy  payable  to  a  nonresident  who  dies  before  receiving  it, 

when  taxable    

legacy  to  a  widow  in  lieu  of  dower 

money  deposited  in  bank  to  pay  debt  due  nonresident..  38,  151 

money  loaned,  is  not  an  advancement 

money  of  a  nonresident  deposited  with  a  trust  company 148 

not  made  in  contemplation  of  death 

not  to  take  effect  at  or  after  donor's  death 82 

note  of  legatee    

notes  owned  by  nonresident  decedent  within  this  State 146 

payment  of  loan  by  exercise  of  power  of  appointment 115 

personal  property  administered  upon  without  this  State 39 


302  GENERAL   INDEX. 

TRANSFERS  —  Continued : 

Taxable  Transfers  —  Continued :  page. 

personal  property  of  resident  wherever  situated 38 

profits ;    when  taxable    48 

promissory  note,  payable  to  husband  and  wife 53 

property  held  by  partners    43 

property  on  nonresident,  when  taxable 119-164 

residence  of  beneficiary   immaterial   39 

saving  bank  deposits ;   in  trust  for  another 49 

joint   account,  husband   and  wife 50 

where  either  or  the  survivor  may  draw 51 

where  "  mother  or  daughter  "  may  draw 52 

seat  in  New  York  Stock  Exchange 45,  138 

stock   of  foreign   corporations    43 

stock  of  New  York  corporations  owned  by  a  nonresident....    125 

stock   in  a  joint-stock  association 43 

stocks  pledged,  are  taxable  when  redeemed 46 

to  take  effect  at  or  after  donor's  death 69,     77 

United  States  bonds  prior  to  1892  and  after  1898 45 

where  donee  survived  donor  only  three  days 80 

words  necessary  to  make  a  taxable  bequest 46 

(See  Appraisal;   Exemptions;   Future  and  Limited  Estates;   Nan- 
residents;  Power  of  Appointment;  Transfer  Tax.) 
TAXING  DEBTS  ERRONEOUSLY  ALLOWED: 

section  225  of  the  Tax  Law 209,  215 

TRANSFER  TAX: 

amount  of,  how  measured   26,  328 

administrator,  etc..  liable  for  (§  224,  Tax  Law) 198 

basis  of  value   254 

collection  of,  by  executors,  etc 203 

composition  agreement  respecting   (§  233,  Tax  Law) 364 

failure  to  tax  known  property,  effect  of 254 

if  directed  to  be  paid  as  an  administration  expense,  when  to 

be   deducted    324 

is  not  a  property  tax 1 

is  to  be  assessed  upon  the  present  value,  although  transferred 

by  appointment   114 

is  upon  method  of  acquisition 2 

is    upon    succession    by    will,    or    devolution    in    case    of    in- 
testacy    1)      2 


GENERAL    INDEX.  503 

TRANSFER  TAX  —  Continued:  page. 

law  does  not  apply  to  remainders  and  reversions  created  prior 

to  its   passage    298 

law  in  force  at  time  of  transfer  controls 55 

lien  on  the  property  until  paid  (§  224,  Tax  Law) 198,  200 

nature  of   16 

on  legacy  to  executor  (§  226,  Tax  Law) 216 

on  real  estate,  not  to  be  assessed  against  executor 205 

on  remainders  in  trust  estates,  is  presently  payable 297 

paid  out  of  property,  does  not  make  it  a  tax  on  property.  ...  2 

paid  on  transfer  in  another  State,  not  to  be  deducted 322 

payment  of,  to  county  treasurers,  in  certain  counties 186 

payment  to  State  Comptroller,  in  what  counties 186 

rate  of,  under  power  of  appointment 114 

refund  of,  erroneously  paid   (§  225.  Tax  Law) 207 

sale  of  what  property  to  pay 205 

the  test  of  value  by  which  tax  is  measured 267 

when  due  and  payable   (§  221.  Tax  Law) 185 

when  legacy  is  renounced 30,  217 

when  property  is  subject  to  power  of  appointment 97 

when  tax  attaches  to  legacy 25 

when  tax  will  be  paid  from  donee's  residuary  estate 110 

(See    Appraisal;    Nonresidents  —  Nontaxable    Transfers;    Taxable 
Transfers;   Transfers.) 

TRUST  COMPANIES: 

consent  of  Comptroller  to  transfer,  how  obtained 222 

corporations  transfer  at  their  peril,  when 223 

liability  of,  to  pay  tax   (§  227,  Tax  Law) 219 

obligation  to  give  notice  rests  on 223 

penalty,  how   incurred    221 

transfer  of  decedent's  property  by 219,  220,  221 

TRUST  DEEDS: 

not  constituting  an  absolute  gift 77 

not  made  to  take  effect  at  donor's  death 82 

when  interest  accrues  under 82,  84 

TRUSTEES: 

bequest  to,  in  favor  of  exempt  corporation 59 

devise  to,  to  found  a   home 63 

(See  Administrator;  Executor.) 

U. 
ULSTER  COUNTY: 

transfer  tax  clerk  in  ( §  234,  Tax  Law) 369 

salary  of 369 


504  GENERAL    INDEX. 

UNCONSTITUTIONAL  PROVISION:                                                    page. 
part  of  chapter  76,  Laws  of  1899,  relating  to  taxation  of  es- 
tates which  vested  prior  to  June  30,  1885 11 

UNDISTRIBUTED  ESTATE: 

share  in,  not  presently  taxable 58 

UNITED  STATES: 

bequest  to,  is  taxable 43 

bonds   of,  not  taxable  between  May   1,   1892,   and   March   21, 

1898 60 

bonds  of,  were  taxable  prior  to  the  Act  of  1892,  and  are  taxable 
since  1898,  March  21st 45 

V. 
VESTED  ESTATES: 

"  accrued,"  when  equivalent  to  vested 84,     85 

although  will  contains  no  words  of  present  gift 86 

payment  of  tax  on,  from  property  transferred  in  trust 288 

vested  prior  to  Tax  Law,  not  taxable 58 

when  taxable  prior  to   1897 300 

VESTED   AND   CONTINGENT   ESTATES   AND    REMAINDERS: 

when  contingent   278 

when  vested   278 

when  vested  in  interest   278 

when  vested  in  possession   278 

VOIDABLE  TRUST: 

discretionary  power  to  use  principal  creates 294 

VOLUNTARY  PAYMENT  OF  TAX: 

what  is   1 89 

when  not  deemed  voluntary 190 

W. 
WESTCHESTER  COUNTY: 

appraiser  in  ( §  229,  Tax  Law) 234 

salary  of   , 235 

transfer  tax  assistant  in  (§  234,  Tax  Law) 368 

salary  of  368 

WIDOW: 

articles  enumerated  in  section  2713  of  the  Code,  not  entitled  to 
money  allowance  for 319 


GENERAL    INDEX. 


505 


WIDOW  —  Continued :  PAGE- 

dower  of,  not  taxable 67 

dower  right   is   the   property   of   the   wiodw,   not   of   tes- 
tator     68 

legacy  in  lieu  of,  is  taxable  if  accepted 44 

not   a   debt   of   the   estate 55 

entitled  to  money  equivalent  in  lieu  of  necessary  provisions 

and  fuel  for  sixty  days 315 

exemption  to,  under  section  2713  of  the  Code 61 

WILL: 

surrogate  can  construe  on  appeal  in  transfer  tax  proceedings..  341 

WILL  OF  NONRESIDENT: 

not  conclusive   as  to   decedent's   residence 161 

WITNESS: 

competency  of,  on  appraisal  2o3 

fees  of  (§  230,  Tax  Law) 241 

,       .       „,                                                    253 

legatee   as    

surrogate  can  issue  commission  to  examine  nonresident 230 

when  nonresident  executor  not  obliged  to  testify 253 


INDEX  TO  FORMS. 


PAGE. 

Affidavit  for  appraisal  of  the  property  of  nonresident  decedents. ...  431 
Affidavit  to  be  filed  upon  application   for  letters  testamentary  or 

letters   of  administration 440 

Affidavit  required  by  the  State  Comptroller  upon  application  for 
the  removal  or  transfer  of  the  property  of  a  nonresident 
decedent  where  transfer  tax  proceedings  have  not  been  insti- 
tuted     434 

Agreement  —  Upon  composition  of  transfer  tax 436 

Application  to  justice  of  Supreme  Court  for  reappraisal 439 

Application  to  Superintendent  of  Insurance   414 

Certificate  of  Comptroller  showing  payment  of  tax  upon  real  estate 

belonging   to   decedent 438 

Citation  to  show  cause 429 

Decree    directing    payment 430 

District  attorney  proceedings  —  Petition 428 

Memorandum  suggested  by  the  appraisers  of  New  York  county  in 

preparing  affidavits  to  be  used  upon  appraisals   409 

Notice  of  appeal    to   surrogate 420 

Notice  of  appeal  to  the  Appellate  Division   422 

Notice  of  assessment   of   tax 420 

Notice  of  hearing  before  appraiser  413 

Notice  of  motion  on  application  to  remit  interest 423 

Notice  by  bank  or  trust  company  of  the  transfer  of  deposits 441 

Notice  of  intended  transfer  of  stock  of  New  York  corporations....   442 
Notice  by  bank  or  trust  company  of  the  transfer  of  deposits  in  the 

joint  names  of  a  decedent  and  one  or  more  persons,  etc 443 

Notice    of    intended    delivery    of    contents    of    safe-deposit    box    to 

executors,  etc 442 

Oath    of    appraiser 412 

Order  assessing  tax  where  no  appraisal  has  been  directed 426 

Order  designating  appraiser 411 

Order  designating  appraiser  —  Nonresident  decedent 434 

Order  determining  the  taxable  transfers  and  assessing  the  tax....   419 

Order  exempting  estate 427 

Order  granting  citation 429 

[507] 


508  INDEX   TO   FORMS. 

PAGE. 

Order  remitting  interest  from  ten  to  six  per  cent 424 

Order  returning  report  to  appraiser 418 

Order  of  surrogate  on  appeal 421 

Petition  —  District  attorney,  proceedings  428 

Petition  for  appraisal  —  Resident  decedent 410 

Petition  for  appraisal  —  Nonresident  decedent 433 

Petition  for     appraisal  and  determination  by  surrogate 425 

Petition  to  remit  interest 422 

Petition  showing  estate  to  be  exempt 427 

Report  of  appraiser 415 

Subpoena •_«. 413 


INDEX  TO  THE  SECTIONS  OF  THE  TRANSFER 
TAX  LAW. 


PAGE. 

Section  220.  Taxable  transfers 34 

221.  Exceptions   and   limitations 164 

222.  Accrual  and  payment  of  tax 185 

223.  Discount  and   interest 192 

224.  Lien  of  tax   and   collection  by  executors,   adminis- 

trators, and  trustees   198 

225.  Refund  of  tax  erroneously  paid 207 

226.  Taxes  upon  devises  and  bequests  in  lieu  of  commis- 

sions    216 

227.  Liability  of  certain  corporations  to  tax 219 

228.  Jurisdiction  of  the  surrogate 227 

229.  Appointment  of  appraisers,  stenographers,  ct  cetera.  234 

230.  Proceedings  by  appraiser 241 

231.  Determination  of  surrogate 326 

232.  Appeal  and  other  proceedings   337 

233.  Composition  of  transfer  tax  upon  certain  estates...  364 

234.  Surrogate's    assistants    in    New    York,    Kings,    and 

other  counties   367 

235.  Proceedings  by  district  attorneys 370 

236.  Receipt  from  county  treasurer  or  comptroller 379 

237.  Fees   of   county  treasurer 382 

238.  Books  and  forms  to  be  furnished  by  the  State  Comp- 

troller    383 

239.  Reports  of  surrogate  and  county  clerk  384 

240.  Reports  of  county  treasurer 385 

240a.  Report  of  State  Comptroller ;   payment  of  taxes ....  387 

241.  Application    of    taxes 388 

242.  Definitions 389 

243.  Exemptions  in  article  one  not  applicable 394 

282.     Limitation  of  time  202 

[Whole  Number  of  Pages  539.] 


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